08 August 2023

My second residence becomes my family home: what should I do?

by Stephanie Vanmarcke and Ine Coolman

More and more Belgians are purchasing a second residence abroad. In most cases, these are used as holiday homes. It is of course possible, after some time, to make the holiday home your primary residence, and therefore move abroad permanently. Besides all the practical stuff, there are also a great deal of tax issues to consider. Here, we list some of the most important things to consider.

Wealth tax

If you decide to move abroad permanently, a wealth tax may be levied on your worldwide assets. While this is a type of tax that Belgium does not currently impose, many of our neighbours do. For example, France and certain parts of Spain, among others, impose a tax on worldwide assets once they exceed a certain threshold.

Capital gains tax

In terms of any capital gains, the timing of when you decide to move should be carefully considered. For example, capital gains on shares in Belgium are currently exempt. However, if the country of residence changes, it may levy a capital gains tax on the sale of shares. Therefore, in some cases, it may be useful to sell a significant share portfolio before the country of residence changes.

Inheritance and gift tax

Finally, conditions surrounding gift and inheritance tax may also change. In Belgium, it can often be more advantageous for someone to make certain gifts before they pass on. By doing so, (more costly) inheritance taxes can be avoided. When moving abroad for good, depending on the country of residence, it may just be more advantageous not to gift your assets. Again, it is best to figure this out ahead of any move abroad.

Having read this article, do you have any specific questions regarding your move abroad? Our colleagues are happy to guide you through your overseas project so that you do not encounter any unpleasant surprises.

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Stephanie Vanmarcke

Team Manager International

Ine Coolman

Advisor International

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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