Since 1 January 2018 construction companies, that employ shift workers, can benefit from a substantial cut in payroll taxes. Recent legislation clarifies this measure.

What does the exemption entail?

Employers are partially exempted from paying the withheld wage withholding tax to the Belgian Treasury. This exemption equals 6% of the taxable remuneration (salary, wages, shift premium, benefits in kind). In 2020 this percentage will raise to 18%.

Following this modification the exemption cannot be combined with the other two wage withholding tax exemptions for shift and night workers.

In which situation can the measure apply?

Employers must be active in the construction or related business in the sense of the “VAT-royal decree”. The following Joint Committees are included:

  • JC 124 (construction);
  • JC 121 (maintenance);
  • JC 126 (wood and upholstery);
  • JC 144 (agriculture);
  • JC 111 (metal industry);
  • JC 149.01 electricians).

The employees must receive at least 13,75 EUR/hour gross (*) and work:

  • in team shifts of at least 2 persons ;
  • in construction (on yards);
  • at least 1/3 of their working time on the yards.

(*) “Gross” means before deduction of employee’s social security contributions. This amount is indexed yearly (as set out in the new legislation). Students receiving less than 13,75 EUR/hour are excluded.

How can you benefit from the exemption?

You must file a special declaration “wage withholding tax”.

Any remaining balance can be transferred to another eligible employee. This would be the case when the actual withheld wage withholding tax for a certain employee is lower than 6% of the taxable remuneration.