Corona Tax Shelter for the acquisition of new
shares in SMEs: second edition
June 2021 – On 2 April, the Parliament approved a second edition of the corona tax shelter for the acquisition of new shares in SMEs. The (temporary) measure had already been the subject of a first edition (also temporary). It concerned new shares issued between 12 March 2020 and 31 December 2020. The measure now concerns issues made between 1 January 2021 and 31 August 2021.
The principle
An individual who invests in new shares can benefit from a tax reduction of 20% of the capital contributed. The maximum amount of the contribution in this case is 100 000 euros. In case of joint taxation, each spouse is entitled to the tax reduction individually.
The contribution must be made in cash. A contribution in kind will not be taken into account. The measure can be combined with the tax reduction for the acquisition of shares in start-up or growth companies, but the same contribution cannot of course qualify for the tax reduction twice. The measure can also be combined with the previous temporary measure.
You can also benefit from the measure if you are a company director, unless - and this is an important restriction - as a result of the contribution you hold more than 30% of the company's equity.
Finally, you must also keep the shares in your possession for five years. The company will issue the necessary certificates to this effect.
Eligible companies
The tax reduction is only available to Belgian companies (or establishments of foreign companies) :
that can prove a decline in turnover of at least 30% for the period from 2 November 2020 to 31 December 2020 compared to the same period in 2019; and
which are considered small companies in the sense of the CSA (Companies and Associations Code) small company within the meaning of the CSA is a company that does not exceed more than one of the following criteria: a) number of employees, on average per year: 50; b) annual turnover, excluding VAT: 9 000 000 euros; c) balance sheet total: 4 500 000 euros.
Many companies are also excluded from the measure:
investment, finance or treasury companies;
companies whose main corporate purpose is the construction, acquisition, management, etc. of real estate for their own account
asset management companies
management companies;
listed companies;
companies with links to tax havens.
The sums the company receives cannot be used for the distribution of dividends, for a capital reduction/reduction of the contribution or for the purchase of shares, nor for the granting of loans.
Finally, the company may not receive more than EUR 250 000 in total under this measure. This maximum amount is independent of the maximum amounts of the other tax shelters (i.e. the tax shelters for the acquisition of shares in start-up or growth companies and the previous corona tax shelter for new shares).
Resumption of the tax reduction
As already mentioned, the shares must be held for five years. If the shares are disposed of within five years, the tax reduction will be taken back in the form of a tax increase for the number of "missing months".
The tax reduction will also be taken back if the company no longer meets the conditions.
31 August 2021
You therefore have until 31 August to subscribe to the new shares. These shares must be paid up at that time.
It is good news that the company director can also benefit from the measure, but the restriction that his or her shareholding cannot be or become more than 30% is a major obstacle for family businesses.
