Non-remunerated and abroad based company representatives in Belgium releaved from social security burden
15/07/2014
A new law introduces the possibility as of July 1, 2014, for representatives of companies or partnerships in Belgium to be exempted from the obligation to affiliate with the social security authorities if they can demonstrate that (i) they are not remunerated or, for foreign persons, that (ii) they do not perform their activities in Belgium.
Under Belgian law, anyone who performs an activity other than through an employment contract or as a civil servant with the purpose to make profit is considered to act as a self employed person.
As a self employed person, one must affiliate with a social insurance fund and pay social security taxes, unless he or she can prove that he or she is not performing a self employed activity, e.g. because the activity is only occasional or because there is no profit making purpose.
For company representatives in Belgium, the law provides a presumption that they act on a self employed basis but denied them until July 1, 2014 the possibility to prove that they were not operating on a self employed basis following two irrebutable presumptions regarding their social security status:
The presumption to act in a self-employed capacity triggering the obligation to affiliate with a social insurance fund as a self-employed person and to pay social security contributions as a self-employed person; and
The presumption to act in Belgium (even if the representative did not manage the company from Belgium).
As of July 1, 2014 both Belgian and non-Belgian company representatives are able to demonstrate that they do not pursue a self-employed activity under Belgian law if they can prove that their mandate is not-remunerated and provided that the following conditions are met:
The non-remuneration of the mandate must be proven with a stipulation in the articles of association or a decision of the body which is competent to establish the remuneration of the company representatives; and
The representative may not receive any remuneration whatsoever for the execution of the mandate in the facts.
The representative who can prove that the above conditions are met, does not have to affiliate with a social security fund for self employed persons (nor with the social security authorities for employees as they are presumed not to work under the authority of the company or partnership in any event).
If such proof cannot be rendered or if the above conditions are not met, the representatives of the company or partnership will be considered self employed persons and must affiliate with the social security service for self employed persons.
Furthermore, the non-Belgian company representatives (not limited to company representatives from the EU) can as of July 1, 2014 prove that they pursue their activity from another country than Belgium and be exempt from the affiliation under the Belgian social security regime for self-employed persons (at least not regarding this activity). How such proof can be rendered is however not yet determined in the legislation and is subject to the conclusion of a Royal Decree which will provide for the practical modalities in this respect.