{"id":9480,"date":"2024-04-05T11:24:39","date_gmt":"2024-04-05T09:24:39","guid":{"rendered":"https:\/\/fix-blog.local\/blog\/mixed-vat-payer\/"},"modified":"2025-05-08T12:41:07","modified_gmt":"2025-05-08T10:41:07","slug":"mixed-vat-payer","status":"publish","type":"post","link":"https:\/\/www.accountable.eu\/en-be\/blog\/mixed-vat-payer\/","title":{"rendered":"Mixed VAT liability: what is it?"},"content":{"rendered":"\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\"><strong>Unless you\u2019re exempt from charging VAT, when you\u2019re self-employed in Belgium, you generally charge 6% or 21% VAT on the invoices you send to your Belgian-based clients. But what if you\u2019re only VAT exempt for part of your activities? You\u2019re then considered a \u2018mixed VAT payer\u2019. What does that mean for your accounting, tax returns, VAT declarations and invoicing? Read on to find out more.&nbsp;<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading font-degular scroll-mt-32\" id=\"mixed-vat\"><strong>What does it mean to be a mixed VAT payer?<\/strong><\/h2>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">You\u2019re considered a mixed VAT taxpayer&nbsp;<strong>when you carry out both activities that are subject to VAT and activities that are exempt from VAT<\/strong>. VAT-exempt activities are defined&nbsp;<strong>in <a class=\"font-inter text-purple underline underline-offset-1\" href=\"https:\/\/www.minfin.fgov.be\/myminfin-web\/pages\/public\/fisconet\/compare\/0d4dbaa6-8f28-4044-b582-79fb5171220d\/c4fc97b2-ba4b-4baa-aa1b-22a05236ea2e\/c4fc97b2-ba4b-4baa-aa1b-22a05236ea2e\">Articles 39 to 42 and Article 44 of the VAT Code<\/a> <\/strong>(available in French and Dutch). You\u2019ll find more specific examples below.&nbsp;<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\"><strong>\ud83d\udca1<\/strong><strong>Accountable tip:<\/strong>&nbsp;Being a&nbsp;<em>mixed<\/em>&nbsp;VAT payer is not the same as being a <em>partial&nbsp;<\/em>VAT payer. A partial VAT payer also carries out activities where VAT simply does not apply. For example, an individual working as an employee and who is self-employed in a secondary occupation selling products is a partial VAT payer, because VAT isn\u2019t applicable for their employee salary.<\/p>\n\n\n\n<h3 class=\"wp-block-heading font-degular scroll-mt-32\" id=\"exempt\"><strong>VAT-exempt activities<\/strong><\/h3>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">Certain activities carried out by a self-employed sole trader or someone who is self-employed with a company are always&nbsp;<strong><a class=\"font-inter text-purple underline underline-offset-1\" href=\"https:\/\/finance.belgium.be\/en\/enterprises\/vat\/vat-obligation\/vat-obligation#q3\">exempt from VAT<\/a><\/strong>. These are identified in the Belgian VAT Code. Here are the&nbsp;<strong>main activities that are exempt from VAT<\/strong>:<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">\ud83c\udfe5&nbsp;<strong>Medical activities<\/strong>&nbsp;performed by doctors, dentists, nurses, etc.<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">\ud83d\ude91 Activities within the framework of&nbsp;recognised and regulated&nbsp;<strong>paramedical professions<\/strong><\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">\ud83c\udfeb&nbsp;<strong>Socio-cultural activities<\/strong>&nbsp;such as caring for the elderly or teaching activities<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">\ud83c\udfe0 The sale, leasing and rental of&nbsp;<strong>property<\/strong><\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">\ud83d\udcc8&nbsp;&nbsp;<strong>Insurance activities<\/strong><\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">\ud83d\udcb3&nbsp;<strong>Financial activities<\/strong>,&nbsp;e.g. issuing loans<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">\ud83c\udfa8&nbsp;&nbsp;<strong>Artistic or literary works intended for publication<\/strong><\/p>\n\n\n\n<h3 class=\"wp-block-heading font-degular scroll-mt-32\" id=\"examples\"><strong>Mixed VAT payers: some examples<\/strong><\/h3>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">It\u2019s not always easy to understand which combination of activities results in the status of mixed VAT payer. Here are some examples to help you better assess your situation:<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">\u2764\ufe0f\u200d&nbsp;<strong>&nbsp;A self-employed activity in healthcare combined with the sale of products.<\/strong>&nbsp;For example, a dentist who also sells oral hygiene products. Dentistry services are exempt from VAT, but the sale of products is subject to VAT.<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">\u200d\ud83e\uddd1\u200d\ud83c\udfeb&nbsp;&nbsp;<strong>Educational services combined with the sale of materials.<\/strong>&nbsp;For example, a school that offers VAT-exempt training, but also sells textbooks or school supplies.<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">\ud83c\udfad&nbsp;&nbsp;<strong>Cultural institutions offering hospitality services.<\/strong>&nbsp;For example, a museum or theatre that is exempt from VAT for its cultural activities, but which also operates a brasserie or restaurant.<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">\u200d\ud83e\uddd1\u200d\ud83c\udfa8&nbsp;<strong>An artist who carries out several activities.<\/strong>&nbsp;For example, a painter who is exempt from VAT on a publishing contract, but subject to VAT for the abstract works he sells.<\/p>\n\n\n\n<h2 class=\"wp-block-heading font-degular scroll-mt-32\" id=\"consequences\"><strong>Mixed VAT liability: what are the implications?<\/strong><\/h2>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">Mixed VAT liability has an impact on your&nbsp;<strong>right to VAT deduction<\/strong>.<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">As a VAT payer, you need to <strong>repay the VAT you apply on your invoices to the state<\/strong>. On the other hand, you can&nbsp;<strong>deduct the VAT you pay on your professional purchases<\/strong>. This is not the case for those who are exempt from VAT.&nbsp;<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">The situation is a little more complex for&nbsp;<strong>mixed VAT payers<\/strong>, since they can&nbsp;<strong>only recover part of the VAT paid on expenses<\/strong>.&nbsp;&nbsp;<\/p>\n\n\n\n<h3 id=\"how-to-calculate-your-right-to-vat-deduction\" class=\"wp-block-heading font-degular scroll-mt-32\"><strong>How to calculate your right to VAT deduction<\/strong><\/h3>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">As a mixed VAT taxpayer, you can&nbsp;<strong><a class=\"font-inter text-purple underline underline-offset-1\" href=\"https:\/\/finance.belgium.be\/en\/enterprises\/vat\/vat-obligation\/partial-vat-deduction\/mixed-taxable-persons#q2\">calculate your VAT deduction<\/a><\/strong>&nbsp;in two ways: on a&nbsp;<strong>pro rata<\/strong>&nbsp;basis or based on your <strong>actual use<\/strong>.&nbsp;<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">The <strong>pro rata<\/strong>&nbsp;<strong>method&nbsp;is based on your turnover<\/strong>. In the case where 75% of your turnover comes from VAT-exempt activities, you can only deduct 25% of the VAT paid.&nbsp;<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">The<strong> actual use method<\/strong>&nbsp;takes into account the&nbsp;<strong>final purpose of the costs incurred<\/strong>. VAT is fully deductible on purchases incurred for your VAT-subject activities, while VAT on purchases related to your VAT-exempt activities is not deductible. The problem with this method is that <strong>some purchases are not limited to a single activity<\/strong>. For these, you can&nbsp;<strong>therefore determine a pro rata yourself<\/strong>, provided it&#8217;s credible.&nbsp;<\/p>\n\n\n\n<h3 id=\"which-method-should-i-choose-to-calculate-the-vat-deduction\" class=\"wp-block-heading font-degular scroll-mt-32\"><strong>Which method should I choose to calculate the VAT deduction?<\/strong><\/h3>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">Until 2023, you had to choose the pro rata method, as the actual use method required authorisation. Now, you can opt for the actual use method if you prefer, and have to&nbsp;<strong>indicate this in an electronic declaration<\/strong>&nbsp;(via form 604A or 604B online).<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">This declaration must be submitted:<br>\u2013 at the latest&nbsp;<strong>before the end of your first monthly or quarterly declaration<\/strong>&nbsp;of the current calendar year if you\u2019re already a mixed VAT payer; or<br>\u2013 <strong>before the end of your first declaration period<\/strong>&nbsp;after the start or modification of your activity if you\u2019re a new mixed VAT payer.&nbsp;<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">The actual use method therefore starts on<strong>&nbsp;1&nbsp;January&nbsp;or the first day of the month\/quarter <\/strong>in which you started your activities.&nbsp;<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">If you file your declaration&nbsp;<strong>late<\/strong>, this method can only be applied&nbsp;<strong>from 1 January&nbsp;of&nbsp;the following year<\/strong>.<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">Note:<strong> <\/strong>If you switch to the<strong> actual use<\/strong>&nbsp;method, you must use it for&nbsp;<strong>at least three calendar years<\/strong>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading font-degular scroll-mt-32\" id=\"billing\"><strong>Mixed activity billing<\/strong><\/h2>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">When you\u2019re subject to mixed VAT, invoicing&nbsp;can be tricky. Applying VAT to some invoices, but not to others\u2026 You might even have to partially apply VAT to some invoices.<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">If the invoices are for services or goods&nbsp;<strong>that are exempt from VAT, the invoices must state this<\/strong>&nbsp;<strong>clearly<\/strong>. For example, you can add the words \u201cExempt from VAT under Article 44 of the VAT Code\u201d. Accountable can help you prepare your invoices correctly.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading font-degular scroll-mt-32\" id=\"vat-declaration\"><strong>VAT declaration for mixed VAT payers<\/strong><\/h2>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\">Are you a mixed VAT taxpayer and you carry out some activities that are subject to VAT and others that are VAT exempt? You need to&nbsp;<strong>clearly distinguish between the two<\/strong>&nbsp;on your VAT return to have an accurate calculation of your right to VAT deduction.<\/p>\n\n\n\n<p class=\"font-inter text-base leading-relaxed mb-4 first-of-type:mt-0 text-black\"><strong>Finally, don&#8217;t hesitate to seek advice from an accountant. They\u2019ll help you complete your VAT return!<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Unless you\u2019re exempt from charging VAT, when you\u2019re self-employed in Belgium, you generally charge 6% or 21% VAT on the invoices you send to your Belgian-based clients. But what if you\u2019re only VAT exempt for part of your activities? You\u2019re then considered a \u2018mixed VAT payer\u2019. What does that mean for your accounting, tax returns, [&hellip;]<\/p>\n","protected":false},"author":24,"featured_media":9482,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[2,275],"tags":[257,262],"class_list":["post-9480","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-humans-of-accountable","category-vat","tag-exempt-from-vat","tag-vat"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Mixed VAT liability: what is it? - Accountable<\/title>\n<meta name=\"description\" content=\"What does it mean to be a mixed VAT payer and how can you make sure your invoices and VAT declarations are prepared correctly? 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