How is rental income taxed in Belgium?

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Are you self-employed in Belgium and renting out a residential property, an office, or another type of building? If so, you need to know how to correctly declare your rental income on your tax return. How is income from property rental taxed, and is there a difference between renting as a private or professional activity?

Below, you’ll find out how income tax on property rental is calculated so you can avoid any unpleasant surprises. 

How is rental income taxed in Belgium?

In Belgium, rental income is taxed differently depending on your status, the status of the person you rent your property to, and the type of rental itself. There are some major differences:

• Do you have the status of natural person (whether as an individual or self-employed in a primary or secondary activity) or do you rent out your property through a company (such as an SRL/BV)?
• Is your tenant an individual (who uses the property privately) or do you rent the property to a company or a self-employed person (who uses the property professionally)?

How rental income is taxed depends on whether you rent your property to an individual or a business. Let's explore the differences together.

Private rental of an unfurnished property to an individual

Are you renting a property (as a natural person) to an individual who uses it exclusively as their private residence? Rental income from this (second) property is subject to a specific type of taxation in Belgium.

In fact, the tax is not calculated based on the actual rental income, but on an amount based on the indexed cadastral income, increased by 40%. 

🙋🏻‍♂️ Example: You rent out a property with a cadastral income of €900. The tax on this rental is calculated as follows (income year 2024): €900 x 2.1763 (2024 index) x 1.4 = €2,742.14.

This amount is then added to any other income you have, and you’re taxed according to Belgium’s progressive tax brackets (25-50%). If you’re in the highest tax bracket (50%), you’ll pay a maximum of €1,371.07 in tax on the rental income for this property.

In other words, the tax burden is quite low compared to a tax based on the actual rental income.

The 2025-2029 Federal Government Agreement will soon introduce a new calculation for the tax on rental income. For second, third, etc. properties, it will no longer be the cadastral income that is taxed via personal income tax, but the actual rental income. A base amount will be exempt from tax. The exact amount of this exemption and how the tax will work have yet to be clarified.

Private rental of a furnished property to an individual

Are you renting a furnished property to an individual? In this case, the rules change. The income is split into several parts:

• Income from the rental of immovable property (the property itself)
• Income from the rental of movable property (the furniture)
• Income from additional services (e.g. cleaning fees)

In a furnished property, the rental of the furniture is set at a flat rate of 40% of the total rent, unless otherwise stated in the rental agreement. You can also deduct 50% of this amount as expenses. The remaining amount is taxed at 30%.

🏡 Example: You rent out a furnished apartment for €1,000 per month. The gross rent for furniture is €1,000 x 40% = €400. After deducting 50% of expenses, you have €200 left, which is taxed at 30%, resulting in €60 in tax per month.

Do you offer additional paid services, such as monthly cleaning? This income is considered ‘miscellaneous income’ and is taxed at 33%. This income must be declared in Part II of your tax return, under code 1200/2200.

Professional rental

If your tenant uses your property for business purposes, the rental income is taxed much more heavily. In this case, the property is considered a commercial property, and you pay tax based on the actual rental income, reduced by flat-rate expenses of up to 40%. This amount is also added to any other income you have when calculating your personal income tax.

🏡 Example: Let's say you rent the same property, with a cadastral income of €900, for €900. In the best-case scenario, the situation looks like this: 12 x €900 x 0.6 = €6,480. If you’re in the highest tax bracket, you’ll therefore pay €3,240 in tax on this rental.

This is much more than for private rentals. So be careful if you rent a property to a self-employed person who works from home, for example. If this person deducts (part of) the rent as a business expense, you, as the landlord, will end up paying more in tax. To avoid this, mention in the lease that the tenant is not allowed to deduct rent as a business expense.

Do you have to be self-employed to rent out a property?

No. In Belgium, property rental is generally considered a private activity. It’s therefore not necessary to become self-employed to be able to rent out a property. From a legal perspective, there’s no clear line between renting as a private activity and renting as a professional activity. 

Even if you rent out multiple properties, there’s no obligation to be self-employed, whether as a sole trader or a company.

In what situations is property rental considered a professional activity?

In principle, renting out a property is something you can do as an individual, without having to set up a business. However… there are some situations in which the tax authorities may consider your rental activities as a professional activity. For example, if you:

• borrow money to buy or renovate property
• offer additional services (such as cleaning, breakfast, etc.)
• systematically buy homes, renovate them and rent them out

In such cases, the tax authorities may no longer consider you a passive landlord, but rather someone who is running a business.

What are the consequences of starting a business?

To rent out property as a professional activity, you can be self-employed as a sole trader or with a company. It’s worth knowing that renting property as a professional activity means you’re subject to some additional rules and taxes:

• You’re taxed on the actual rental income, not on a fictitious amount, as in the case of renting out property as a private individual.
• You can only deduct actual expenses (plus flat-rate expenses).
• If you’re a sole trader, you pay personal income tax and social security contributions. 
• If you start a company, you pay 25% corporate tax on rental income. You then need to take this money out of your company in a tax-efficient way (salary, dividends, etc.).

To summarise: everything gets a little more complicated and technical when you’re renting out properties as a professional activity, but that doesn't mean it’s a bad idea.

What advantages does being self-employed offer?

Do you regularly buy and renovate properties and then rent them out? In this case, it may be worth becoming self-employed. Why?

• You probably incur a lot of expenses for repairs, renovations and equipment.
• These expenses (and other business expenses) are deductible, which can significantly reduce your taxable profit.
• Purchase costs (such as notary fees or registration fees) and other professional expenses are also tax deductible.

You may pay more in tax, but you also gain more flexibility. 

When does it make sense to start a business to rent out properties?

Are you considering renting out property in a structured, professional way? Do you want to make it your full-time source of income or are you already very busy with renovating and renting? Then it's time to consider becoming self-employed as a sole trader or by starting a company.

Yes, you'll pay a little more in tax. But you'll also be able to deduct more expenses, and you'll be fully in line with all your tax obligations. As for the admin side, it's easy with a tool like Accountable!

Want to know if Accountable is right for you? Get started for free today and you'll quickly get an idea of ​​the taxes (and profits!) you can expect when you’re self-employed.

FAQ: Frequently asked questions about tax on rental income in Belgium

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.

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