DBI funds and private PRICAFs: take minimum director remuneration into account
by Dries Torreele and Julie Vantomme
Many companies invest in qualifying DBI funds to achieve tax-efficient investment returns. The DBI deduction can be applied to distributed dividends without having to meet the traditional conditions. In practice, this means that the receiving company is not taxed on the dividends received. However, from assessment year 2026 onwards, the tax landscape will change. A new condition makes the minimum remuneration of a director who is a natural person suddenly crucial.
Why are DBI funds tax-efficient?
DBI funds are legally required to distribute 90% of their net income annually in the form of dividends. A withholding tax of 30% is deducted by the fund on this distribution, meaning that 70% is paid to the investing company.
The withheld withholding tax can be regarded as a prepayment, as it can ultimately be offset against the corporate income tax due. If the balance is positive, the difference is even refunded.
Additional condition: minimum remuneration
What had previously been announced following earlier government agreements has now also been approved by Parliament. The offsetting of the withheld withholding tax against corporate income tax is now dependent on compliance with a minimum remuneration requirement.
Specifically, the company must grant at least one director who is a natural person:
either a remuneration of EUR 45,000,
or a remuneration of at least 50% of the taxable profit (before deduction of that remuneration).
From when does this additional condition apply?
This additional condition applies from assessment year 2026 (and therefore to all financial years ending on or after 31 December 2025).
Companies that do not meet this minimum remuneration requirement will no longer be able to offset the withholding tax and will see this deduction result in an effective tax increase of 30% on all dividends received.
Not limited to DBI funds
This new condition applies more broadly than DBI funds alone. It also applies to dividends derived from:
private PRICAFs,
REITs (regulated real estate companies),
SREIFs (specialised real estate investment funds).
For companies that actively invest, it is strongly recommended to verify whether the minimum remuneration is effectively met (including benefits in kind) and, where necessary, to make timely adjustments.
Tip:
If you do not meet (or cannot meet) the minimum remuneration requirement, the additional tax burden can sometimes be limited by not applying the DBI deduction.
Our tax experts will be happy to advise you on your specific situation.
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Dries Torreele
Senior Manager Tax | Certified Tax Advisor dries.torreele@vdl.be
Julie Vantomme
Manager Tax julie.vantomme@vdl.be
Disclaimer
In our opinions, we rely on current legislation, interpretations and legal doctrine. This does not prevent the administration from disputing them or from changing existing interpretations.
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