Employment in Belgium

At a Glance:

• The service and trade sectors employ the largest number of people.
• There are different work permits, each applicable to a different need. Getting a work permit is usually the employer’s responsibility.
• The taxation rate depends on your residency status and EU nationals are protected against double taxation.
• There are different sectors of social security; expats from EU/EEA countries enjoy the same rights as Belgian nationals.

A large number of expats working in Belgium are directly or indirectly employed by EU institutions or NATO. Together with its numerous affiliates and sub-organizations, NATO accounts for nearly 4,000 international military and civilian staff in Belgium. In fact, the SHAPE (Supreme Headquarters Allied Powers Europe) community near Mons is a nearly self-sufficient village with residential areas, shops, schools, sports facilities, a library, and a cinema.

Thanks to its international character, Belgium has also become a preferred location for international business. Expats in Belgium add to the country’s highly productive workforce and help drive this modern, private-enterprise economy. Apart from Brussels, expats often settle in Antwerp, the world’s most important diamond trading center.

The Monopoly of the Service Sector and Trade

Like so much else in Belgium, the economy is also of a dual nature: people working in Belgium’s Flemish regions profit from a diversified industrial and commercial economic base; on the other hand, the Walloon economy in the French-speaking region is somewhat less dynamic.

The service sector is the main economic driver in all parts of the country, both with regard to GDP and employment figures. Indeed, the service sector composes almost 77% of the GDP, compared to only 22% from industry and a mere 0.74% from agriculture. It is therefore understandable that most people are employed in the service sector.

As a country of few natural resources, Belgium relies heavily on trade. Belgium imports significant amounts of raw materials and exports large volumes of manufactured goods, which leaves it vulnerable to global market fluctuations, although three-quarters of its trade is with other EU nations so exposure to currency fluctuations is limited. Far likelier are problems stemming from the international banking and financial services sector. In 2008, several Belgian banks required government assistance and one was partly nationalized.

The ABCs of Work Permits

EU nationals do not require a permit in order to start working in Belgium, but all third-state nationals should be aware of this additional obstacle before they can start their new job. However, the responsibility of obtaining a work permit for a foreign employee usually falls on the employer rather than on the employee. The following types of permits are available for people who want to start working in Belgium:

• A Permit: This one is an exception, as it is only aimed at foreigners who are already working in Belgium on a B Permit (see below). It is exclusively granted to people who have been employed in Belgium for a minimum of four out of ten years. The advantage of an A Permit over a B Permit is that holders of the former are no longer tied to a specific job and are permitted to change employers.
• B Permit: This is the permit your prospective employer needs to obtain on your behalf before you can start your new job in Belgium. It is valid for one year and commits you to the job for which it was originally granted. The challenge for the employer lies in proving that the vacancy cannot be filled by any current citizens or permanent residents of Belgium.
• C Permit: People with a limited-duration residency status, e.g. students or refugees, can apply for this permit if they want to take up temporary work in Belgium. C Permits are not tied to a specific job or employer.

Work Permits and Taxation in Belgium

The Steps to Getting a Work Permit

As previously mentioned, employers are responsible for sorting out the work permit situation for their foreign employees. The latter merely need to fill out the application form. They must also provide a medical certificate from a doctor approved by the Belgium embassy or consulate in the applicant’s country of residence. A signed work contract is required in support of the application as well.

However, people who already have a B Permit and would like to “upgrade” to an A Permit should take matters into their own hands. The forms to be filled out are available at the regional job centers: the FOREM for Wallonia, the VDAB for Flanders, the Arbeitsamt for the German community and the Ministère for the Brussels-Capital Region.

How to Pay Your Taxes

How you are taxed in Belgium depends on your residency status. Foreigners who qualify as Belgian residents are taxed on their entire income; those who don’t are only taxed on income arising from Belgian sources. Criteria for evaluating your residency status are your physical presence (registration) and/or the place where your assets are managed. If either of the above is in Belgium, you will be classified as a resident for tax purposes.

A special clause exists for those who are granted expatriate status by the tax authorities. They are entitled to a tax-free allowance to cover additional costs commonly associated with a temporary expat lifestyle. Expatriate allowances are capped at roughly 11,000 EUR per year, or 30,000 EUR in certain cases, i.e. for activities of a controlling or coordinating nature or for scientific research. Furthermore, expats who qualify under this scheme are treated as non-residents for tax purposes.

If you are liable to pay income tax in Belgium, you will be notified by your community’s tax authorities. Belgian residents have to file a tax return by 30 June each year for income earned during the previous calendar year. This can be done online via FPS Finance (French and Dutch).

Avoiding Double Taxation

EU nationals working in Belgium are protected against double taxation by EU treaties. However, regulations may differ slightly by member state.

Apart from that, Belgium has also concluded double taxation treaties with several countries outside the EU. You can download a complete list of taxation treaties from the FPS Finance website. These treaties guard citizens of both contract partners against double taxation, which might otherwise arise if the tax authority of the country of residence interferes with that of the “source” country.

Social Security and Healthcare in Belgium

Understanding the Social Security System

Belgium has a contribution-based social security system which distinguishes between “classical sectors” and “social assistance”. The seven classical sectors are old-age pension and survivor’s pension, unemployment benefits, insurance for work-related accidents, insurance for occupational diseases, family benefits, compulsory insurance for medical care, and annual vacation, which is considered part of social security for blue-collar workers, but not for white-collar employees.

Every month the employer pays between 30% and 40% of an employee’s salary into the social security fund. Part of an employee’s gross salary, amounting to around 13%, is also automatically withheld for social security contributions. The resulting fund serves to pay for social security. Self-employed persons pay quarterly contributions, which are calculated on the basis of their annual net income three years prior to the year for which the contribution is made. Please consult the Federal Public Service’s very useful Social Security brochure for further information.

Are You Eligible? Social Security for Expats

EU/EEA nationals have the same rights and duties as Belgian citizens. They are liable to make social security contributions if they are classified as Belgian residents, i.e. if their stay exceeds three months and if they are physically present in Belgium for more than 183 days per year. Their social security contributions made during their active periods in any EU member state also add up when it comes to calculating their social security benefits, e.g. upon retirement or in case of incapacity benefits.

Belgium has signed social security agreements with several countries outside the EEA. These include Algeria, Australia, Bosnia-Herzegovina, Canada, Chile, Congo (DR), Croatia, India, Israel, Japan, Kosovo, Macedonia, Morocco, Montenegro, the Philippines, San Marino, Serbia, South Korea, Tunisia, Turkey, Uruguay, and the USA.

The social security contributions you have to make and those you are entitled to depend on your residency status and the respective social security agreement. To find out more, consult the relevant page of the Belgian Social Security Portal and click on your country.

Mandatory for Everyone: Health Insurance

Compulsory health insurance is an integral part of the Belgian social security system and nearly every Belgian resident is entitled to medical care under this scheme. More information on how to select an insurance fund can be found on the Belgian Social Security Portal in French, Dutch, and German. For additional information about health insurance in Belgium consult our article on life in Belgium.