Patrimony company, foundation and partnership

Sometimes it can be useful to work with a company, an association, a contractual arrangement. Contrary to popular belief, tax motives are not necessarily decisive. A company can sometimes be more expensive and will also cause complications that otherwise do not exist. However, depending on the concrete situation and the ultimate objectives, these can be very useful.

(The knights of the round table probably had other intentions).

Patrimony companies

Property can be purchased through a company. It is also possible to buy split (e.g. the physical person the bare ownership, and the company the usufruct). A house or business can be brought in to a company.

The incurred expenses are tax deductible. It must be taken into account that rent will have to be paid to this company. If this is not done, its use will in any case be taxed (benefits in kind). A company may also enjoy preference in the context of a future division of succession. The shares are movable assets and their donation is subject to a lower gift tax than the house to which it relates. This was certainly the case in the past. In recent years, however, the gift tax relating to real estate between parents and children has decreased sharply (3% till 150.000€, 9% between 150.000 and 250.000€,18% between 250.000 and 450.000€, above 27%).

On the other hand, a company is subjected to corporate tax, annual accounts must be drawn up. It is not given to everyone to draw up and complete these without the support of an accountant, which involves again expenses. A current account often arises. Funds of the company that are used privately, or vice versa. This must be expressed correctly from an accounting point of view. The tax authorities can themselves add interest when the company's funds are used privately.

Closure and dissolution of the company leads to a final capital gain tax (difference between the real and book value).

Foundations

Private foundations, created by the Belgian legislator (under the influence of foreign legislation) allow certain constructions. It is managed by directors, who are designated in the notarial deed of incorporation. A supervisory board can even be formed. A foundation can also be designated for the management of the assets of a "child" that is not competent to manage his assets, and thus acting as a special administrator.

The patrimony that parents wish to give to their incapable (or wasteful child) can also be placed in a private foundation. The social purpose then provides that the assets are managed in the best possible way, and that the financial and other assistance to this child should be described very precisely.

They can even be used as an "administration office"( administratiekantoor), so that the patrimonial interests of heirs (who acquire or participate in the family business, who do not appear or appear less suitable for running the family business, can be somewhat absorbed by giving them the security). to claim the fruits (such as dividends).

These rights are also titles, and can be sold back and monetized.

Partnerships

A partnership can keep a family together and do much good in the context of succession planning. Those who donate can perfectly maintain control, but at the same time transfer an important capital (subject to payment of gift tax), without having to levy progressive inheritance tax later. With the new company legislation, the partnership replaces the former VOF. However, it remains a tool that can be useful for succession planning, where the transferor can already donate and still retain control, which is so often desired.

Because the legal regulation on this is very limited, it allows all possible combinations. With the new inheritance law in sight, this makes it easier to work out the succession planning as precisely as possible, in order to avoid later discussions about unregulated situations.