Cadastral income (RC) is the basis for calculating your withholding tax. It corresponds to the average normal net rental income that the property would bring in for its owner in one year. In other words, it’s the average annual net rental value of the property in question.
Whether you’re a private individual or a company, it’s important to ensure that the RC you’re notified is fair. As this is the taxable basis for your withholding tax throughout the “life” of the property, its impact is considerable!
The Administration générale de la Documentation patrimoniale (AGDP) determines the cadastral income of new or substantially altered properties. This is communicated to taxpayers by means of a cadastral notification.
This notified cadastral income may be contested within two months.
It is important to contest the RC as soon as it has been notified, to ensure that the correct withholding tax is paid.
Cadastral income is attributed to ordinary property, but also to machinery and equipment, on which property tax is also payable.
How is the withholding tax calculated?
For buildings by nature :
For machinery and equipment :
Why is your cadastral income worth your attention?
For buildings by nature :
At certain key moments in the life of a property, it is compulsory to reassess its cadastral income.
Under article 473 of CIR 92, it is compulsory to declare spontaneously within 30 days of an event any significant change affecting cadastral income. Such changes may include disinvestments, destructions, renovations, etc., as long as the modification exceeds 15% of the initial capital.
The administration must be informed when the following changes are made:
Apart from these events, cadastral income cannot be revalued.
To initiate a dispute, follow these steps:
- Propose an alternative amount: Determine a more precise income for your business by revaluing your assets.
- Justify your proposal: Prepare solid documentation that explains and justifies this new amount (at Ayming we work with tax lawyers, surveyors…).
- Send your claim: Send your claim by registered letter to the official in charge of your file at the General Administration of Heritage Documentation. No later than 60 days after receipt of the notification.
For machinery and equipment :
For companies, inventories of machinery and equipment are subject to a tax assessment based, once again, on cadastral income. Given the high value of these assets, small inaccuracies in cadastral income valuation can result in significant tax discrepancies.
The valuation of assets, whether valuable machinery or essential equipment, influences a company’s tax planning. It also affects compliance with legal reporting obligations. Rigorous management of machinery and equipment lists and accurate records ensure fair taxation and prevent unnecessary financial burdens.
What’s more, fixed assets recorded in inventory are rarely static. This also means a change in your tax base:
- New investments are being made;
- Capital equipment reaches the end of its useful life;
- Cadastral income from certain equipment is exempt, etc.
Rigorous management of the aspects that determine your cadastral income means :
- Paying the correct property tax;
- Have a clear view of your taxed machinery and equipment;
- Monitoring investments and divestments;
- Seize the opportunity to retroactively generate 5 years of savings on withholding tax;
- Maintain a clean tax base for years to come.
In conclusion
Accurate and appropriate management of your machinery and equipment can improve financial strategies and ensure better tax compliance.
As a result, changes in your fixed assets are frequent, and your tax base must evolve accordingly. Recent investments and the end-of-life of some equipment require regular updating.
To adapt the cadastral income of your machinery and equipment, you must :
- Provide an alternative amount and justify it to the cadastral administration office;
- This alternative amount is proposed in the form of an annual declaration;
- This declaration lists the equipment and tools for which the amount of the CR must be included in the PI’s taxable base;
- This declaration must be made no later than January 31 of the year following the fiscal year concerned.
Missing notification?
If you have not received notification, this may be due to a failure to declare changes in your inventory. However, you still have the opportunity to revise your cadastral income by contesting your extrait de rôle warning(aanslagbiljet in Dutch) in the following months.
Need expert advice?
At Ayming, we ensure that your tax is based on an up-to-date asset inventory. We also ensure that the notified cadastral income is fair and not overstated.
Contact our experts for :
- Review your cadastral income and property tax,
- Detect potential inconsistencies
- Assess the associated risks.
Our consultants also take care of all the administrative formalities (drafting and sending claims, updating the list of your equipment and tools, etc.) and ensure rigorous follow-up of your file with the relevant authorities.
Want to know more about your cadastral income and taxes? Download our white paper :
