💡 What is this article about?
As a freelancer in Belgium, you are not automatically subject to VAT from day one. You may benefit from the VAT franchise scheme, a simplified regime that exempts small businesses from charging and declaring VAT, as long as your annual turnover stays below €25,000.
But what happens when you approach or cross that threshold? And who should actually opt for VAT liability, even before reaching it? This article answers both questions and gives you a practical checklist to manage the transition.
When does a self-employed person become VAT-liable?
There are four main situations that make you VAT-liable as a Belgian freelancer:
1. You exceed €25,000 in annual turnover This is the most common trigger. The moment a single invoice pushes your cumulative turnover above €25,000, you must start charging VAT, from that invoice onwards, not retroactively.
2. You choose not to opt for the franchise scheme at the start The franchise is not automatic. When you register your activity (via form 604A), you actively choose whether to apply for it or not. If you don't request it, you are subject to VAT from the first euro invoiced.
3. Your activity is excluded from the franchise scheme
Some activities cannot benefit from the franchise for their entire economic activity, regardless of turnover. These are:
VAT units (as defined in art. 4, §2 of the Belgian VAT Code)
Businesses that regularly carry out construction work (travaux immobiliers as defined in art. 19, §2 of the VAT Code) and related operations. Note: this is not all construction-adjacent businesses, only those doing immovable property work on a non-occasional basis
Horeca businesses required to use a registered till (caisse enregistreuse), specifically: operators of establishments where meals are regularly consumed, and caterers who regularly provide catering services and are required to issue a till receipt
Businesses that regularly supply used materials, industrial and non-industrial waste, recovery waste, partly processed waste and debris (as listed by Royal Decree)
If your activity falls into one of these categories, you are compulsorily VAT-liable from the start.
4. You voluntarily opt for VAT-liable status: Even if your turnover is below €25,000, you can choose to become subject to VAT. This can be strategically interesting in certain situations, more on this below.
For whom is the franchise scheme the right choice?
The franchise scheme is well suited if:
You work mainly with private individuals (B2C): not charging VAT makes your prices more competitive, since your clients cannot recover VAT anyway.
You have few VAT-eligible business expenses in Belgium, if you don't buy much equipment or make significant investments, there is little VAT to reclaim, so the deduction benefit of being VAT-liable is limited.
You want to keep your accounting simple, no periodic VAT returns, no monthly client listing, just an annual income tax declaration and a yearly client listing.
You are just starting out and expect to stay comfortably under €25,000 for the first year or two.
💡 Working mainly with businesses (B2B)?
The VAT-liable status is often more advantageous. Your clients can recover the VAT you charge them, so the price difference disappears. And crucially, you get to deduct VAT on all your own purchases and investments. If you have significant expenses or work exclusively B2B, becoming subject to VAT, even voluntarily below the threshold, can be the smarter financial move.
How is the €25,000 threshold calculated?
The threshold applies to your annual turnover excluding VAT, and covers a full calendar year (January to December).
What counts towards the €25,000:
All supplies of goods and services that would normally be subject to VAT
Exports and intra-Community supplies of goods
Income from VAT-exempt property rental
What does NOT count:
Sale of investment goods (e.g. a company car you sell)
Services provided to B2B clients established in another EU member state (these fall under the reverse charge mechanism and are localised outside Belgium)
Income exempt under art. 44 of the Belgian VAT Code (e.g. therapeutic medical services, education)
⚠️ Starting mid-year?
If you launch your activity partway through the year, the €25,000 threshold is reduced pro rata for the remaining days of the calendar year. For example, if you start on 1 July, your threshold for that year is approximately €12,500.
What happens when you exceed the threshold?
Exceeded by up to 10% (up to €27,500): You may keep the franchise until the end of that calendar year, as a one-off administrative tolerance. From 1 January of the following year, you switch to the normal VAT regime. This tolerance only applies if the exceedance is both occasional and within 10%.
Exceeded by more than 10% (above €27,500): You must switch immediately, starting from the very invoice that caused the exceedance. There is no end-of-year grace period.
Checklist: switching from franchise to VAT-liable at €25,000
Follow these steps in order when you approach or cross the threshold.
Step 1: Monitor your turnover throughout the year. In Accountable, go to the Taxes tab. At the bottom you will find the VAT franchise threshold tracker, with a graph of your current franchise revenue and a projection to year-end. Check it regularly, especially in the second half of the year.
Step 2: Identify the first invoice that triggers the threshold. VAT applies from that invoice onwards, not retroactively on invoices already issued. That specific invoice must be taxed in full.
Step 3: Complete form 604B online. File the VAT identification amendment declaration (form e-604B) via MyMinfin or through your enterprise counter. This officially notifies the tax authority of your change of regime.
Step 4: Start invoicing with VAT from the triggering invoice. Apply the correct VAT rate to your services: 21% is the standard rate for most freelance services. 12% and 6% apply to specific categories. If in doubt, 21% is the safe default for intellectual services.
Step 5: Check whether you can reclaim VAT paid before the switch When you were under the franchise, you could not deduct VAT on purchases. Now that you are switching, you may be able to recover a portion of VAT already paid on:
Goods and services not yet used or consumed at the time of the change
Investment goods still usable within their revision period (5 years for most assets, 15 years for buildings)
To claim this, you must submit an inventory of your stock and a list of capital goods still in use to the VAT office within 3 months of the change of regime. This is a strict deadline, do not miss it.
Step 6: Update your VAT type in Accountable Go to Menu ➜ Settings ➜ Tax settings ➜ VAT type ➜ select "Subject to VAT". Once updated, future invoices and expenses will be handled under your new regime.
Step 7: Set your VAT filing frequency As a new VAT-liable person, you will generally start as a quarterly filer. You can check and adjust this in Accountable under Settings ➜ Taxes ➜ Filing period.
🚨 Important: can you go back to the franchise?
Once you leave the franchise scheme, whether voluntarily or because you exceeded the threshold, you cannot return to it immediately. The earliest you can reapply is 1 January of the second calendar year following the change.
Examples:
You switch on 1 July 2026 → earliest return: 1 January 2028
You exceed the threshold in 2026 → you are subject to normal VAT in 2027 → earliest return: 1 January 2028
And of course, you must meet the conditions again (turnover below €25,000, eligible activity).
Questions about your switch to VAT-liable status? Your Accountable tax coach is here to help. 😊