Tax Audit in Belgium: How to Prepare With Confidence

A tax audit is a reality that any Belgian entrepreneur may face. Whether it is a simple desk review or an in-depth inspection, being well prepared makes all the difference. In Belgium, FPS Finance (the Federal Public Service for Finance) carries out tens of thousands of tax audits every year. This guide explains in detail how a tax audit works, what your rights and obligations are, and how to prepare for it calmly and effectively.

Who audits you, and why?

FPS Finance and its administrations

FPS Finance (SPF Finances) is the authority responsible for tax audits in Belgium. It is organised into several administrations:

• General Administration of Taxation (AGFisc): responsible for income tax (personal, corporate, legal-entity and non-resident tax) and related levies.
• General Administration of Collection and Recovery (AGPR): responsible for collecting taxes.
• General Administration of Customs and Excise (AGD&A): responsible for customs duties and excise.
• Special Tax Inspectorate (ISI): responsible for serious tax fraud cases. The ISI handles the most complex and significant files.
• General Administration of Patrimonial Documentation: responsible for registration duties and inheritance tax.

The VAT control unit

VAT audits are carried out by VAT control teams attached to the AGFisc. They are organised by regional centre and specifically target compliance with the VAT Code.

Why are you audited?

Tax audits are not random. Several factors can trigger one:

1. Computerised selection: FPS Finance uses data-mining algorithms to detect anomalies in tax returns (unusual turnover variations, ratios that are atypical for the sector, and so on).
2. Data cross-checking: matching data between VAT returns, personal/corporate tax returns, tax certificates, banking data (via the central contact point at the NBB), the land registry, and more.
3. Sector audits: in certain years, FPS Finance targets specific sectors (hospitality, construction, e-commerce, liberal professions, and so on).
4. Whistleblowing: a third party (a former employee, a competitor, an ex-spouse) may report suspected fraud.
5. Random audits: a proportion of audits are carried out at random to maintain a "deterrent effect".
6. Follow-up to a previous audit: if a previous audit revealed irregularities, a follow-up audit is likely.

The different types of tax audit

The desk review (internal audit)

This is the most common and least intrusive type of audit. The inspector examines your file from their desk, without visiting you. They can:

• Ask for clarification by letter or phone
• Require specific supporting documents
• Correct clerical errors

This audit is based on article 316 of the CIR 92 (the right to request information) and article 61 of the CTVA (the right to request VAT information).

The on-site audit (external audit)

The inspector visits your business premises. This audit is more thorough and is based on:

• Article 319 of the CIR 92: the right to inspect business premises during operating hours
• Article 63 of the CTVA: the right of access to premises where the business is carried out

The inspector may:

• Examine your books, registers and accounting records
• Check your till
• Examine your computer files
• Take copies of documents

The periodic VAT audit

VAT-liable businesses are subject to periodic audits linked to the filing of VAT returns. The inspector checks:

• Consistency between VAT returns and the accounts
• The correct application of VAT rates
• The legitimacy of VAT deductions
• Invoice compliance

The ISI (Special Tax Inspectorate) investigation

The ISI intervenes in cases of serious, organised tax fraud. It has extensive investigative powers, including the ability to:

• Request banking information directly from banks
• Work with the judicial authorities
• Conduct cross-border investigations

Your rights as a taxpayer

The Taxpayer's Charter (law of 4 August 1986, as amended) and the Income Tax Code guarantee fundamental rights:

1. The right to be informed

• You must be notified in advance of the audit (art. 333 CIR 92), except in cases of suspected fraud.
• The audit notice must state the nature of the audit and the tax years concerned.

2. The right to be assisted

• You have the right to be assisted by an accountant, a chartered accountant or a lawyer during the audit (art. 338 CIR 92).
• Your adviser can answer on your behalf, sign documents and discuss matters with the inspector.

3. The right to be heard (audi alteram partem)

• Before any correction, the inspector must send you a notice of correction (art. 346 CIR 92) detailing the proposed adjustments and their justification.
• You have one month (extendable on reasoned request) to submit your observations.

4. The right to banking secrecy (now relaxed)

Banking secrecy has been considerably relaxed in Belgium. Since the law of 14 April 2011, the tax authorities can request banking information as part of a tax audit, provided certain conditions are met:

• A prior request for information must have been sent to the taxpayer
• The taxpayer must have had the opportunity to respond
• Evidence of fraud or concrete elements must justify the request

The central contact point (PCC) at the National Bank of Belgium centralises information on Belgian taxpayers' bank accounts.

5. The right of appeal

If you disagree with the tax assessment issued:

• Administrative complaint: within 6 months of the tax assessment notice, to the regional director of FPS Finance (art. 371 CIR 92).
• Judicial appeal: within 3 months of the director's decision, before the Court of First Instance (art. 1385undecies of the Judicial Code).
• Appeal: before the Court of Appeal.
• Cassation: before the Court of Cassation (on points of law only).

Audit and correction deadlines

Ordinary period: 3 years

The tax authorities have 3 years from 1 January of the assessment year to issue an additional tax assessment (art. 354, para. 1 CIR 92).

Example: for income earned in 2025 (2026 assessment year), the authorities can issue corrections until 31 December 2028.

Extended period: 7 years (fraud)

In cases of fraud or breach of the Code's provisions, the period is extended to 7 years (art. 354, para. 2 CIR 92). The burden of proving fraud lies with the tax authorities.

VAT deadlines

• Ordinary period: 3 years (art. 81bis CTVA)
• Period in cases of fraud: 7 years (art. 81bis, para. 3 CTVA)
• Starting point: 1 January of the year following the one in which the cause of chargeability arose

Deadline for registration duties

• Ordinary period: 2 years
• Period in cases of concealment: 10 years

How to prepare for a tax audit

Before the audit: proactive preparation

1. Keep flawless accounts

• File your documents chronologically and systematically
• Keep every supporting document: invoices, receipts, bank statements, contracts
• Reconcile your accounting entries regularly with your bank statements
• Close your accounts on time: annual accounts must be filed with the NBB within 7 months of the financial year-end (for companies)

2. Check the consistency of your returns

• Make sure your periodic VAT returns are consistent with your annual return
• Check that the turnover declared for VAT matches the turnover declared for income tax
• Check that your tax certificates (281.50 for fees, 281.10 for remuneration) are correctly prepared

3. Build a permanent file

Prepare a file containing:

• The company's articles of association and any amendments
• The UBO register (ultimate beneficial owners)
• Management agreements and management contracts
• Minutes of general meetings and board meetings
• Tax returns for the past 7 financial years
• The corresponding tax assessment notices

4. Identify the sensitive areas

Certain items are systematically scrutinised by inspectors:

On the day of the audit

1. Welcome the inspector properly

• Be polite and professional
• Provide the inspector with a quiet workspace
• Have your accounting documents ready and accessible
• Ask the inspector to identify themselves and state the purpose of the audit

2. Get assistance

• Your accountant or tax adviser should be present. Their technical expertise can prevent misunderstandings and unwarranted reassessments.
• A tax lawyer is recommended for major audits or in cases of suspected fraud.

3. Golden rules during the audit

• Answer questions factually, without volunteering unnecessary information
• Never lie: making a false statement is a criminal offence
• Ask for time if you need it to locate a document
• Take notes of everything requested and discussed
• Sign nothing without having read and understood the document
• Ask for copies of anything the inspector takes away

4. What the inspector can and cannot do

After the audit

1. The notice of correction

If the inspector identifies irregularities, they will send you a notice of correction (art. 346 CIR 92). This document must:

• Detail each proposed correction
• State the legal basis for each one
• Give you one month to respond

2. Submitting your observations

• Review each correction point with your accountant or lawyer
• Respond point by point, with supporting arguments
• Provide any additional supporting documents
• Request an extension if necessary (generally granted on reasoned request)

3. The additional tax assessment

If your observations do not convince the inspector, an additional tax assessment will be issued. It will include:

• The additional tax due
• A tax increase of 10% to 200% depending on severity (art. 444 CIR 92)
• Late-payment interest of 4% per year (2026 rate, art. 414 CIR 92)

Possible sanctions

Fines and tax increases

Criminal sanctions

In cases of tax fraud, criminal proceedings may be brought:

• Simple tax fraud (art. 449 CIR 92): imprisonment from 8 days to 2 years and a fine of EUR 250 to 500,000
• Serious, organised tax fraud: aggravated penalties, confiscation of assets
• Laundering the proceeds of tax fraud: article 505 of the Criminal Code, prison sentences of 15 days to 5 years

Tax regularisation (DLU)

Belgium has run several waves of Single Liberating Declarations (DLU), allowing taxpayers to voluntarily regularise undeclared income. The Regularisation Contact Point within FPS Finance manages these files. In 2026, permanent regularisation remains possible under the conditions set out in the law of 21 July 2016.

Case studies

Case 1: An audit of car expenses

Pierre, the director of an SRL in Namur, uses a hybrid BMW X3 (CO2 emissions: 45 g/km) for business. He declares 80% professional use.

The inspector checks:

• The percentage of professional use: Pierre must prove this usage (a diary, GPS data, a logbook)
• The benefit in kind (ATN): calculated under the statutory formula: catalogue value x 6/7 x CO2 percentage x age coefficient
• The deduction of expenses: capped according to CO2 emissions under the formula introduced by the law of 25 November 2021 (greening motor vehicle taxation)

Case 2: A VAT audit of a restaurant owner

Sophie runs a restaurant in Liège. The VAT inspector carries out a margin test: comparing declared turnover against purchases of raw materials and applying a sector multiplier (generally between 3 and 4 in hospitality).

If the declared turnover is lower than the result of the margin test, the inspector may presume concealed revenue and proceed with an assessment based on indicators.

Case 3: Insufficient director's remuneration

Marc is the director of an SRL in Bruges. His SRL makes a taxable profit of EUR 120,000, but Marc pays himself remuneration of only EUR 30,000, preferring to distribute the rest as dividends.

The inspector notes that the remuneration is below the EUR 45,000 threshold (art. 215, para. 3 CIR 92). As a result, the SRL will be subject to a separate 5.1% contribution on the difference between EUR 45,000 and EUR 30,000 (i.e. EUR 15,000), representing an additional contribution of EUR 765.

Conclusion

A tax audit is not inevitable, and certainly not a disaster if you are well prepared. The keys to a calm tax audit are: rigorous accounting, well-organised and accessible documents, knowledge of your rights, and support from a competent professional.

Do not wait to be audited before putting your affairs in order. Good day-to-day accounting hygiene is the best investment you can make for your peace of mind and the long-term survival of your business.

---

This article was written by the Espero-Soft team for the blog dedicated to entrepreneurs in Belgium. For personalised advice, consult an ITAA-registered chartered accountant or a tax lawyer.