In these turbulent times, showing our support is not a luxury. You can offer support in the form of a cash donation, directly to an association or through an online payment platform.
To be tax-deductible, the cash donation must amount to at least EUR 40 per calendar year and per association, and be paid to an association or institution recognised by the Minister of Finance or their representative. The institution or association will then provide a certificate to the donors before 1 March of the following year. Both private donations and corporate donations are tax deductible provided that the donor does not receive anything in return.
Do you want to apply for recognition as an association or institution?
Then the first step is to check whether your association meets the requirements for recognition.
A recognition depends on the activities carried out by the association.
The website of the Ministry of Finance contains an exhaustive list of a number of categories of activities:
- scientific research,
- monuments and landscapes (preservation or care),
- nature and environment,
- war victims,
- disabled, elderly, protected minors, destitute,
- victims of recognised natural disasters in Belgium,
- developing countries,
- victims of very large industrial accidents,
- sustainable development,
- animal shelters.
Does the association carry out one or more of the above activities? Then you can start the application procedure.
Submit your application in writing by e-mail or by post to the Minister of Finance no later than 31 December of the year before you want the recognition. The application cannot be submitted earlier than three months after the establishment of your institution. In other words, an application for the year 2022 must have been submitted by the end of 31 December 2021.
Please include the following documents in your application:
- application form stating the activity(ies) for which you wish to obtain recognition,
- a completed, dated and signed declaration of commitments,
- other document(s), depending on the activity, establishing whether you meet the conditions in function of your activity.
As soon as your association is recognised, you must provide annual certificates to the donors in order to obtain a tax reduction. Your accountant can always help you with this.
Make a note in your diary that the recognition has to be renewed in time.
If your application is approved, your recognition is valid for:
- The first recognition, two years,
- The second recognition, four years,
- The third recognition, six years.
In order to keep the awarded recognition period, you must annually prove that your institution is subsidised by the Belgian state or by one of the Communities. If you cannot sufficiently prove this, there is a risk that your recognition is withdrawn. It is not enough for your institution to have received from a municipality. Once the recognition has been withdrawn, the procedure for a renewal is similar to that for the first recognition.
What benefit do these gifts provide?
Are you a private individual? In that case, the tax reduction is 45% of the amount actually deposited and stated on the certificate. The reduction is calculated per family, regardless of the name on the certificate.
The total amount of donations for which reduction is granted is limited to either 10% of the total net income, or EUR 392,200 (assessment year 2021 – income 2020).
These amounts apply per taxpayer and not per family.
What about companies? A company may deduct a donation from the profit but the total deduction is limited to either 5% of the total taxable profit before deduction of those donations, or EUR 500,000. A donation is also only deductible from the profit of the financial year and therefore not transferable to later periods.
Our Bofidi experts are happy to help you
Do you have specific questions about donations? Do not hesitate to contact us. The Bofidi team of experts is happy to help you.