Welcome to Belgium 🇧🇪 and start your life as self-employed, hassle-free
Here you are, you have made up your mind: lucky you, you have just arrived in the country of beers & chocolates and want to kick off your freelancer activity. Or even better: you have been there for some time now and wanted a change in your career: in any case, you are about to start your activity as self-employed.
We know the feeling, we’ve been there ourselves.
In this article, we share with you all the things we wish we had known before starting as self-employed. No more wondering what the process is and what pitfalls to avoid: welcome in your new life.
Any tips or questions for us? Email us at email@example.com and we will be in touch shortly.
It all starts by getting the right license 📜
If you are living in Flanders, you are in luck and can skip to the next section: as of September 1st, 2018, you do not need to demonstrate basic management knowledge to start a business.
Whether you reside in Brussels or Wallonia, to register as self-employed, you need to be able to demonstrate that you have enough basic knowledge on how to operate and run a business. Without this proof, you will not be able to register your company at the Crossroads Bank for Enterprises.
So, how can you demonstrate this knowledge?
You can also resort to your professional experience to prove your knowledge: several years of experience in the field you are applying for are typically needed (this last part only for Wallonia).
If none of these options works for you, you can always decide to go back to school and take an exam at the central examination board.
Next step? Open a dedicated bank account 🏦
At the end of the day, you are not working for free, of course.
That is why it is always helpful to have a bank account where you can receive payments.
We recommend you to open a separate bank account: by having a dedicated bank account, you can better keep track of your receivables. Most importantly, it gives you the option to separate your professional expenses from your day-to-day expenses. Tax authorities will love that for sure.
Opening a bank account can be done with any bank, please choose one of your likings. Some banks even allow you to create an account without leaving the comfort of your desk (or your couch). Enjoy!
You are on to affiliate yourself to a social security fund and register with the Crossroads Bank for Enterprises 🏛
Registering to the Crossroads Bank for Enterprises is the core step of the process: it’s the basis of your relationship with the State as a self-employed worker.
Indeed, if you don’t register with the CBE, you won’t have a company number. A company number is a number that appears on all of your invoices.
The CBE register contains all the details of your company (name, address, etc.) as well as those of all self-employed in Belgium.
The registration with the CBE will cost you a one-time payment of 89,50 euros (in 2020).
Time to get your basic layer of insurance as a self-employed 🥅
As a self-employed, you also need to affiliate yourself to a social security fund. You can choose any of these social security funds (sorry only in Dutch).
Don’t be mistaken; it is a mandatory step: failing to do so early on as you start your activity will put you in deep trouble.
The fund that you choose will take care of family allowances, child benefits, your (small) pension as self-employed and some safety net in case of e.g. bankruptcy.
Want to know more about the benefits of social security are?
No worries, we have a specific article for you.
How much you need to pay for this fund depends on how much you are earning. Social contributions amount to around 20% of your taxable income.
Of course, as a starter, it is difficult to estimate how much you will earn: there is usually nothing to base your estimation on. You can choose between a fixed minimum amount (746.23 euros) or a higher amount of your choosing.
We recommend matching, as much as possible, your social contributions to 20% of your taxable income. If you wait to do so, tax authorities will come back at you years later & claim the difference. Believe us, it is not a spot you want to be in.
Finally, don’t forget to let your health insurer know about your status change so that you can benefit from sickness and invalidity insurance.
💡TIP: You pay social contributions for the entire quarter, even if you’re only working for one week during that same quarter. Aspiring self-employed, choose your starting date carefully!
VAT or no VAT 💵 ?
As a self-employed, you might obtain a VAT number and become liable to VAT.
In Belgium, that number is the same as your company number.
As soon as you have this VAT number, you can start invoicing and receiving money for the products & services you deliver to your customers.
The VAT is actually simple: it is a tax you collect from your customers and pay back to the government, typically on a quarterly basis.
You claim the VAT back from certain professional purchases (excluding restaurants, for instance).
You start issuing VAT returns as soon as you start collecting VAT from your customers. Thankfully the government made an easy to use calendar so you know what the exact dates are when you need to start paying,
Of course, if you’re using Accountable, you get timely reminders as well.
If you want to get a VAT number for your business you can do so by filling in this form (sorry only available in Dutch and French). You can also do it via Accountable: our partnership with Xerius allows you to fully start as a self-employed, including receiving your VAT number, via your smartphone.
When your turnover is below 25.000 €, you can choose to be exempted from VAT. In that case, no need for you to file the VAT declaration every quarter. You only need to submit a listing of clients on a yearly basis, by March 31st. It naturally means that you cannot deduct any VAT from your expenses and that you do not pay back VAT to the tax administration.
Some other things to keep in mind:
- Specific professions, e.g. bakers and cafeteria owners, can issue a flat-rate VAT statement. Their annual turnover may not exceed 750,000 euros in the past year and they can only issue invoices for a maximum of 25% of their total turnover.
- If your turnover is higher than 2 500 000 euros, you must submit your VAT return on a monthly basis.
You’re off to the races! Now all you have to do is work and reap the fruits of your hard work as self-employed – or rather part of the fruits;
In the end, only part of the sum that your customers pay you goes and stays into your pocket: each year, you will pay taxes on your taxable income of the year before.
OK, you got it: your customers pay you, you pay your suppliers, you keep track of all your paperwork. It might seem overwhelming to keep track of all of it all, but we have developed a solution – readily available on your most personal device, your smartphone.
Thanks to our app, you can record your expenses, prepare and send your invoices, follow-up on your payments and know which taxes you need to pay.
By self-employed people, for self-employed people. Because we experienced ourselves all the difficulties that come with being self-employed in Belgium.
Back to you! Did we miss anything? What steps did you take to become self-employed? And what are the best things about being self-employed for you? Get in touch, we are here to help.