Company tax return: last minute checklist

The company tax return has been changed on several points. We provide below an overview of the most important changes and the new rules applicable for income tax year 2011. So you have a short checklist including the latest points of interest before filing your return.

Taxable reserved profit

Recharge station: accelerated depreciation

Investments made for recharge stations for electrical vehicles in 2010, 2011 and 2012 can be depreciated faster, regardless their real term of use. These investments can be depreciated linearly over two years, whereby each year half of the invested amount is accepted as depreciation.

Non-taxable reserved profit

Other non-taxable elements (code 310 - 325)

Costs for cars not emitting CO2, can be deducted at 120%. This means that the company will annually increase the amount of the “normal” depreciation or other costs of these assets with 20%. This 20% amount should be reported under “Other non-taxable elements”. This amount should appear in a separate account.

Disallowed expenses

Limitation of deduction of fuel expenditure (code 032)

Fuel expenditure deduction is limited to 75%.

Stricter limitations for car expenditure (code 032)

The deductibility of car expenditure is limited in function of the CO2 emissions. The deduction percentage varies between 50% and 120%, depending on the CO2 emissions. The CO2 emission of a car is mentioned on the registration form issued by the Direction for the Registration of Vehicles (DIV).

Benefits in kind for company cars (code 032)

New rules to calculate the taxable benefit in kind for the private use of company cars are applicable. The benefit in kind will now be calculated as follows: number of private kilometers x CO2 emission per kilometer x CO2-eur coefficient.

Payments made to tax havens (code 054)

Companies making payments to tax havens should report these payments to the tax authorities by using a special form (form 275F). These payments should also be reported under the disallowed expenses.

This is applicable to all payments made to persons established in a tax haven exceeding the threshold of 100.000 EUR during a given financial year. The scope of this legislation is very broad. All kinds of payments are concerned, both cash payments and payments in kind. It does not make any difference whether these payments are made to companies or to private individuals. As soon as it concerns payments to persons established in a tax haven exceeding 100.000 EUR, these should be reported.

Breakdown of profits

Recharge stations for electrical vehicles: increased investment deduction (code 107)

Recharge stations for electrical vehicles can be considered for increased investment deduction. Companies having invested in such recharge stations in 2010, can deduct 13,5% of the investment from the taxable profit for that financial year.

Notional interest deduction (code 103 and 104)

The rate for the notional interest deduction for tax year 2011 is 3,8% and 4,3% for SMEs.

Participation exemption and exempt income

Participation exemption: increased participation threshold

As from 2010 the participation exemption can only be applied in case the company receiving dividends has a participation of at least 10% or with an acquisition value of at least 2.500.00 EUR in the dividend emitting company.

Prepayments

Exemption of tax increase in case of insufficient prepayments

The new SME criterion is applicable as from tax year 2011. As from tax year 2011 no tax increase is imposed for insufficient prepayments for the three financial years after the establishment of a company, provided it is a small company as provided for in article 15 of the Company Code.

Submitting the tax return by 13 October through Biztax

When the financial year of the company is the same as the calendar year, company tax returns on paper should be filed before 15 September 2011. When the tax return is filed online through Biztax, an additional month is granted until 13 October 2011. When the financial year of the company is not the same as the calendar year, other filing dates are applicable.

Companies with a broken financial year

The above only applies to companies closing their financial year on 31 December 2010, and not to companies with a broken financial year.