What are social contributions?
Unless you are independent in a complementary activity, you pay social contributions every quarter to receive the minimum health and pension cover you need as a Belgian citizen. Your social contributions guarantee your social protection, which includes benefits such as child benefits and incapacity benefits.
In Belgium, paying social contributions is mandatory and cannot be avoided, unless specifically requested and agreed upon by your social security provider.
💡 As a general rule, social contributions amount to 20.5% of your yearly taxable income.
This article explains how social contributions are taxed, how they interact with your income tax declaration, and how to record them correctly in Accountable.
Please note that this article provides general guidance only. Tax rules may vary depending on your individual situation. When in doubt, ask your Tax Coach.
How are social contributions taxed?
Social contributions are entirely deductible: they act as any other professional cost and decrease your profit, and therefore your income tax.
In other words, the more social contributions you pay, the less income tax you owe.
Important note: social contributions enter the computation of profit for the year they are paid (or reimbursed), not the year for which they are due. If you need to pay social contributions for a previous year, you will see the impact of that payment in the current year only, not the previous year.
For more information about social contributions, read our blog article on social contributions.
How does it work in Accountable?
In Accountable, every social contribution payment must be recorded as a professional expense.
Social contributions is a category available to all Belgian users, under Taxes & Insurance.
What should I do with my regular quarterly payments for social contributions?
Make sure that every quarterly payment is saved in your list of expenses.
You do not need to attach a document for it to count against your taxes.
What happens when you are asked to make an extra payment because you paid too little in a given year?
In the same way, simply add an expense for the amount to be paid that you received from your social security provider (the amount is normally indicated in the regularisation statement).
For example, if you receive a regularisation statement dated November 8, 2023 (so in Q4 2023) for 2021 contributions, you need to enter it as follows:
→ The expense date must correspond to the date of the regularisation statement:
→ For the VAT category and VAT declaration, select Q4 2023:
What happens when you receive a reimbursement from your social security provider because you paid too much in social contributions?
Simply add a negative expense (a credit note) for the amount you received from your social security provider.
It will similarly enter your tax computations for the year when you received your refund and will be ready for your income tax declaration in Accountable.
🚨 For the category, you have to select the category with the quarter corresponding to the date of reimbursement and not to the year covered by this refund.
What happens when the refunds received are greater than the total amount paid during the year?
When the total of your social security contributions paid and received during the year results in a negative amount (for example, because you received a refund of social security contributions from the previous year, and this amount is greater than the total paid during the year), your total contributions are negative. However, it is not possible to enter a negative figure in box XVII - 1632 of the IPP declaration on Tax on Web.
You have 2 options:
Add the refunds to the taxable gross income (box XVII - 1600), and only indicate the social security contributions paid in box XVII - 1632. You must do this manually and remove the refunds from your deductible expenses in Accountable.
Add the negative amount indicated by Accountable for social security contributions to the amount reported in box XVII - 1600, and enter €0 in box XVII - 1632.
Key takeaways
Social contributions are fully deductible as a professional expense, reducing your income tax.
Contributions are recorded in the year they are paid or reimbursed, not the year they are due.
Every payment, extra payment, or reimbursement must be recorded as an expense (or negative expense) in Accountable under Taxes & Insurance.
If your net contributions for the year are negative, you have two options for how to declare them in box XVII of the IPP declaration on Tax on Web.
Need help? Chat with us or email support@accountable.eu, we're happy to help.