VVPR-bis Dividends: Only a Few Weeks Left to Benefit from the 15% Rate

SME shareholders and directors considering a dividend distribution in the near future should review their eligibility for the VVPR-bis regime. As from 1 July 2026, the reduced withholding tax rate applicable to these dividends will increase from 15% to 18%.

Although the regime remains attractive, this change may have a noticeable financial impact for shareholders.

A Brief Reminder: What Is the VVPR-bis Regime?

The VVPR-bis regime allows certain dividends to benefit from a reduced withholding tax rate, provided specific conditions are met.

It generally applies to shares that are:

• registered shares;
• issued by an SME;
• subscribed in exchange for a cash contribution;
• compliant with the conditions set out in Belgian tax legislation.

After a mandatory holding period, dividends may be distributed at a withholding tax rate lower than the standard rate of 30%.

Until 30 June 2026, VVPR-bis dividends originating from the profit distribution of the third financial year following the capital contribution, and from subsequent financial years, remain subject to a withholding tax rate of 15%.

What Will Change on 1 July 2026?

The Program Law of 30 May 2026, published in the Belgian Official Gazette on 1 June 2026, modifies this preferential tax regime.

As from 1 July 2026, VVPR-bis dividends that are granted or paid will be subject to a withholding tax rate of 18%instead of 15%.

While the increase is relatively limited, it does reduce the tax advantage currently available to SME shareholders.

An Opportunity Worth Reviewing Quickly

Companies already considering a dividend distribution in the coming weeks may wish to assess whether it is possible to proceed before 1 July 2026.

For example:

• Dividend distributed: €50,000
• Withholding tax at 15%: €7,500
• Withholding tax at 18%: €9,000

In this example, the difference amounts to €1,500.

Whether an accelerated distribution is beneficial will, of course, depend on the specific circumstances of the company.

Do Not Overlook Corporate Law Requirements

Tax considerations should not be the only factor guiding the decision.

Any dividend distribution must also comply with the provisions of the Belgian Code of Companies and Associations, including:

• the balance sheet test;
• the liquidity test;
• the required corporate approval procedures.

Depending on the situation, the dividend distribution may need to be approved by an ordinary or extraordinary general meeting of shareholders.

The Regime Remains Highly Attractive

Despite the increase effective from 1 July 2026, the VVPR-bis regime remains a valuable tax incentive.

A withholding tax rate of 18% is still significantly lower than the standard 30% rate applicable to ordinary dividends.

For many SMEs, VVPR-bis will therefore continue to be an efficient and tax-friendly way of remunerating shareholders.

If your company qualifies for the VVPR-bis regime and you are considering a dividend distribution in the short term, it is advisable to contact your account manager or tax adviser as soon as possible.

A timely review will help determine whether a distribution before 30 June 2026 is feasible and appropriate, taking into account the company’s financial position and legal requirements.

Source: Program Law of 30 May 2026. This law notably provides for the increase of the withholding tax rate on VVPR-bis dividends from 15% to 18% as from 1 July 2026.