Belgians in London - Tax Information WikiEdit
Welcome to the Belgians in London Tax Information Wiki. This wiki is intended for Belgians living and/or working in the UK, listing user created information about Belgian and UK taxation systems
This is probably the most confusion term, as it means something completely different in Belgium and the UK. To understand this, it is important to bear in mind that Belgium has a database of all its citizens, while the UK does not (this is also the reason why in the UK, you often have to provide "proof of address").
In Belgium, the government has the names and main address (domicile) of all its citizens in a database. This means that when you change your main address (domicile), you have to inform the government.
A domicile is someone's (or their family's) main residence. It is defined as the place where someone spends most of his time and/or where the center of his interests are. More info can be found on https://www.belgium.be/nl/huisvesting/verhuizen/hoofdverblijfplaats.
If you want to change your domicile, you have to go to the town hall of the municipality of your new domicile, and register. In case you want to move your domicile outside of Belgium, you have to go to the town hall of your current municipality, let them know you are moving abroad, and provide your new foreign address.
United Kingdom Edit
In the United Kingdom, a domicile is usually the country your father considered his permanent home when you were born. It only changes if you permanently leave that country and don't intend to return. This means that for most Belgians working in the UK, Belgium will still be there country of domicile, even if they are no longer "domiciled" in Belgium.
Tax Residency Edit
Being tax resident in a country means you have to file a tax return in that country. Different countries have different rules about when they consider a person to be resident for tax purposes, and wat income they tax. The rules in Belgium and the UK are significantly different, so it is possible to be tax resident in both countries.
In general, Belgium will generally consider someone resident for tax purposes if his main address (domicile) is in Belgium, but there are exceptions. For example, Belgium will consider you resident for tax purposes if you stay more than half of the year in Belgium, even if your main address is not in Belgium.
United Kingdom Edit
In many ways, the United Kingdom is more strict about tax residency. The exact rules can be found on https://www.gov.uk/government/publications/rdr3-statutory-residence-test-srt . They are quite complicated, but in general you will be tax resident if you stay more than 90 days per year in the UK and have a place to live and/or work more than 40 days per year there.
Tax Year and Filing Dates Edit
The tax year in Belgium follows the calendar year, running from 1 January until 31 December. Every tax resident needs to file taxes, regardless of employment status or level of income. Taxes can be filed online through tax-on-web, and this needs to happen before the end of June.
United Kingdom Edit
The tax year in the UK runs from 1 May until 30 April. Employees don't need to file taxes if they don't have significant non-employment income, everything then happens automatically through Pay As You Earn. Tax on paper needs to be filed before January, online before March.
Taxation system principles Edit
Belgium taxes residents on worldwide income. Tax rates on income are high, but there is no general taxation on capital gains if those capital gains are the result of normal personal wealth management (rather than professional activity or speculation).
Specifically for UK labour income, you have to declare your after tax UK income, converted from GBP to EUR using official National Bank of Belgium exchange rates. You only pay Belgian municipality tax on this income, no additional general income tax.