Simplified sister merger: now also fiscally neutral
by Arne Decorte and Yonah De Waegeneer
Good news for those aiming to optimize corporate structures: since November 2025, a simplified sister merger can now proceed with fiscal neutrality. This allows for easier and more cost-effective mergers between companies with the same shareholder(s).
What is a simplified sister merger?
A simplified sister merger involves the merger of companies whose shares are entirely held by:
the same single shareholder (e.g., A owns 100% of X and Y); or
multiple shareholders in identical proportions (e.g., A and B each own 50% of X and Y).
Although the simplified procedure was already legally possible since June 2023 due to the transposition of the European Mobility Directive into Belgian company law, its fiscal neutrality could not be guaranteed, as the fiscal provisions in the Income Tax Code had not been fully adapted.
As a result, this procedure was never actually used in practice.
What has changed?
On 24 November 2025, a legislative amendment was published in the Belgian Official Gazette, enabling the simplified procedure for sister mergers to be fiscally neutral. This law came into effect on 25 November 2025.
From now on, companies can apply the simplified procedure for such sister mergers, similar to the tax-neutral parent-subsidiary merger (the so-called silent merger).
Key consequences
No need to issue new shares
The simplified procedure means that no new shares need to be issued, as the shareholding structure remains unchanged.No need to calculate an exchange ratio
Normally, one must calculate how many new shares the acquiring company must issue, based on the actual value of the merging companies. This is no longer necessary.No auditor's report required
Unlike in a standard merger, no auditor’s report is required for a simplified sister merger.
Important nuance: indirect sister merger
Note: tax neutrality does not apply to indirect simplified sister mergers. While such mergers are legally permitted, they cannot be executed in a fiscally neutral way if the companies involved are indirectly held by the same person.
Conclusion
We can conclude that this simplified procedure is cost-effective and finally applicable in practice.
If you have any further questions, do not hesitate to contact our experts.
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Arne Decorte
Senior Manager Tax arne.decorte@vdl.be
Yonah De Waegeneer
Advisor Tax yonah.dewaegeneer@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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