What is the Tax Shelter?
The Tax Shelter is a framework that allows private taxpayers in Belgium to deduct 25%, 30% to 45% of the amount of their investment in shares in a scale-up, SME or micro-enterprise from the tax payable on their revenue.
Since February 2017, this tax incentive has been available to crowdfunding platforms and therefore to investors that invest through LITA.co. The scheme forms part of the “start-up plan” framework adopted by the Belgian government which includes various measures intended to support the creation of start-ups and the growth of start-ups ("scale-ups") and SMEs in Belgium.
How does the Tax Shelter work?
When you invest in a LITA.co project that is eligible for tax-shelter you can deduct up to 45% of your investment on the taxes due on your revenue.
This tax advantage is legally limited to €100 000 of eligible investments per investor. Legal entities (non-profits, companies, and cooperatives) cannot benefit from the Tax Shelter.
The financed company undertakes to provide you with all the necessary documents to support your claim for tax reduction and LITA.co ensures that these are available on your personal account on the platform.
You can then directly apply for your tax reduction for the current year by mentioning, in your tax declaration, the number of eligible investments made.
Please, note that an application for tax reduction must be made in the same tax year relating to the taxable period during which the start-up increased its capital. The date of the capital increase is the date of the closing of the crowdfunding campaign on LITA.co.
Which companies are eligible?
The company must qualify as an SME or micro-enterprise or scale-up*, operating and having its registered office in Belgium, and it must be no more than 4 years old (for SMEs and micro-enterprises) and between 4 years and 10 years old (for scale-ups) as of the date of the investment.
Currently, you can benefit from Tax Shelter if you invest in the following projects on LITA.co :
*A micro-enterprise is an enterprise that does not exceed more than one of the following:
A SME is an enterprise that does not exceed more than one of the following
A scale-up is an enterprise that, during the two previous financial years, achieves a growth of at least 10% per annum in employment and/or turnover and which does not exceed one of the following :
This tax incentive is limited to a total share capital of € 500.000 in a micro-enterprise or SME. Scale-ups can fundraise up to €1.000.000 with Tax Shelter but this amount will have to be reduced by the amount that they previously fundraised with the Tax Shelter for micro-enterprises or SMEs.
If you have any questions regarding your eligibility for the Tax Shelter, we kindly ask you to contact your accountant.
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