Starting a business in Belgium? One of your first decisions is whether to register as a VAT franchisee or as subject to VAT. It affects your prices, your admin, and what you can deduct.
Here's how to check your current status, when franchisee makes sense, and where it can bite you.
📌 Not sure which status you're currently registered under? Check via how to verify your VAT type in Accountable or this short video. For the full rulebook on the regime, see Everything you need to know about the VAT franchisee status.
Stay under €25,000 in annual turnover (excluding VAT) and the franchisee scheme is on the table: no VAT on your invoices, no quarterly filings to chase, but no reclaiming VAT on what you buy either. One trade-off, both directions.
💡 Good to know: the €25,000 is your turnover before VAT, not your profit. A freelancer billing €2,100/month is already close to the ceiling.
1. Your admin shrinks to almost nothing. Instead of quarterly VAT filings, you're down to one annual tax return and one annual client listing.
⚠️ Exception: if intra-Community (IC) transactions apply to you (e.g. you buy or sell to other EU businesses), you may still need to file quarterly intra-EU listings or special declarations — it's not automatically once-a-year for everyone.
📄 When and how do I create an annual client listing?
2. Cheaper-looking prices for private clients. No 21% VAT on your invoice means your price looks lower to a private customer, for the same amount in your pocket.
Scenario: Sara is a freelance photographer. She invoices €500 for a shoot as a franchisee. Tom, a VAT-registered competitor, earns the same net amount but has to invoice €605. To a private client comparing quotes, Sara looks like the better deal.
3. No VAT to babysit. You never collect VAT you have to set aside for the tax office.
4. Great fit for low-cost, service-based work. Consultant, freelance writer, small craft seller? You're barely buying anything with VAT on it, so you don't lose much by skipping deduction.
⚠️ If most of your clients are companies who'd deduct the VAT anyway, this "cheaper price" advantage mostly disappears. It only shines with private customers.
The franchisee regime tends to be right when:
Your turnover sits comfortably below the threshold
Your clients are mostly private individuals or small non-VAT businesses
Your costs are low: no big equipment, stock, or renovation spend
You want minimal accounting overhead, especially for a side or starter activity
You're not expecting growth that pushes past €25,000 this year
Scenario: Ali does weekend wedding photography alongside a full-time job. Low expenses, mostly private clients, modest turnover. Textbook franchisee territory.
1. Losing VAT deduction is invisible until it isn't. Buy a laptop, a van, or software, and you pay full price including VAT with no right to claim it back.
⚠️ This is the most underestimated cost of the regime. It feels "free" until you make a big purchase.
2. Crossing the threshold has real teeth. A small overshoot (up to 10%, or €27,500) may let you finish the year under the exemption. Go over by more than that, and you switch immediately, from the transaction that tipped you over.
Scenario: Nora expects to bill €24,000 this year. In November, a surprise contract pushes her to €28,000, more than 10% over. She switches to standard VAT immediately, from that invoice, not waiting until January.
3. You can't just hop back in. Leave the exemption and you can only reapply from January 1st of the third year after you leave. That's a real waiting period, even if your turnover drops right back down.
🔄 Need to switch your VAT status? Here's how
4. There's an EU-wide ceiling too — and it's not automatic. Since 2025, your total EU annual turnover must not exceed €100,000, and you also need to stay under the national threshold of each individual EU country where you do business. Unlike the standard Belgian exemption, this cross-border exemption (the EU SME scheme) isn't applied by default — you have to actively apply for it. Once approved, you're issued an extra VAT number with an "EX" suffix alongside your regular number.
🧾 How to manage VAT on your European sales invoices with the OSS portal
5. "No admin" isn't zero admin. You still file an annual client listing, even a nil one. Plus an intra-EU listing or a special declaration if a foreign supplier invoices you under reverse charge.
📋 How to submit a nil client listing in Intervat as a franchisee?
6. Picking the wrong box is a pain to fix. Selected "franchisee" when you're actually subject to VAT? That means credit notes, awkward client conversations, and reissued invoices.
🛠️ I'm subjected to VAT but selected Franchisee in Accountable, What now?
7. Some activities are excluded, full stop. Construction, VAT groups, and certain Horeca or furnished-accommodation activities can't use this regime, regardless of turnover.
Great fit for small, low-cost, consumer-facing activities comfortably under the threshold. Poor fit if you're growing fast, spending a lot on deductible expenses, or mostly billing VAT-registered businesses.
💡 Before registering, do a quick forecast of your expected turnover and expenses for the year. If you're anywhere near €25,000, take a second look before you commit.
🎥 Join our free webinar on the VAT franchisee regime: real examples, common mistakes, and how to switch if you need to.
Our Accountable Help Center has all our articles to support you day-to-day. Questions? We're here on chat or at support@accountable.eu 😊
Author - Valesca Wilms
As content marketing lead at Accountable Belgium, Valesca writes about freelancing, self-employment, and taxes based on her own experience as a freelancer.
Who is Valesca ?Thank you for your feedback!
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