US R&D and innovation in Belgium

While US companies are attracted to Belgium for their R&D activities by the highly skilled and knowledgeable workforce, successful industry clusters and good collaboration between public and private actors, fiscal incentives are another important factor.

The Belgian Government has introduced a number of R&D tax incentives aiming to encourage companies to invest in top talent and/or innovation.

• Partial withholding tax exemption for researchers: This allows companies to benefit from a partial exemption up to 80% from the wage withholding tax due on the salaries of qualified researchers.
• Innovation income deduction: Under the Innovation Income Deduction (IID) regime, qualifying intellectual property (IP) income is eligible for a tax deduction up to 85%. The IID applies to a broad range of IP rights and allows for the carry-forward of unused deductions.
• R&D investment deduction / tax credit: Companies can choose between an increased investment deduction and a tax credit for the acquisition or development of qualifying patents and environmentally-friendly R&D investments.