Tax Credit on French Dividends Reaffirmed for Belgian Residents

Under the Belgium–France Tax Treaty, France may apply a 15% withholding tax on dividends paid to individuals residing in Belgium. Belgium, as the country of residence, can also tax these dividends at its own rate (currently 30%). To prevent double taxation, the treaty provides for a flat-rate foreign tax credit (quotité forfaitaire d’impôt étranger / forfaitair gedeelte van buitenlandse belasting) that should reduce the Belgian tax burden — with a minimum relief equal to the French withholding rate.

However, since 1988, Belgian law had abolished this tax credit domestically, and the Belgian tax authorities had consistently refused to apply it to French-source dividends.

That changed with a 2017 ruling from Belgium’s Supreme Court (Cour de cassation), which confirmed that international treaty provisions take precedence over domestic law. Most recently, the Court of Appeal in Antwerp (17 December 2019) reaffirmed this principle, confirming that the tax credit must be granted to Belgian resident individuals receiving dividends from French companies.

Belgian taxpayers with French investment income may now benefit from this precedent — including retroactively. Eligible individuals are encouraged to consult with their tax advisors to determine how to apply this ruling.