What tax breaks will you enjoy as a Flemish employer in 2025?
January 2025 - From 1 January 2025, the discount on social security contributions for employers who keep employees aged 62 and over will disappear in Flanders. What Flemish tax breaks will be retained in the coming year, though?
Target group discounts
As an employer, you can benefit from various target group discounts, which reduce social security contributions:
First employee: when hiring a first employee in the private sector, you receive a maximum discount of 3,100 euros per quarter, valid for the entire employment period.
Second and third employees: for the second employee, the reduction is 13,750 euros, spread over 13 quarters. For the third employee, it is 11,250 euros, also spread over 13 quarters. The discount does not have to be taken consecutively and can be spread over 20 quarters.
Long-term unemployed: since 1 October 2023, as an employer who hires long-term unemployed workers (registered with the VDAB for at least two years), you enjoy a discount of 1,000 euros per quarter for four quarters. This applies to both young and older workers, provided they work at least 80 per cent. For working hours of 50 to 79 per cent, the discount is adjusted proportionally.
Working hours reduction: for a voluntary reduction of working hours by at least one hour per week, you are entitled to a financial allowance depending on the size of the reduction. This reduction applies for a period of 4 to 16 quarters.
People with a work restriction: employers who take on people with a work restriction recognised by the VDAB can receive financial support for up to five years. This consists of a wage premium, calculated as a percentage of the wage, and a guidance premium depending on the support needed.
Hospitality sector: hospitality businesses working with a registered cash register can receive a reduction for up to five full-time employees. The reduction is EUR 500 per quarter per employee and EUR 800 for employees under the age of 26.
Exemption from withholding tax
Moreover, you can benefit from an exemption from withholding tax under specific conditions. This means that you may keep all or part of the withholding tax deducted. This scheme applies to start-ups, shift or night workers, overtime and certain scientific research activities, among others.
