Normal or abnormal management: the first and most important test
The first question is whether the share transfer falls within the normal management of private assets.
In its recent advance rulings, the Belgian Ruling Commission (DVB/SDA) accepted normal management based on factors including a long holding period, the absence of a complex or sophisticated structure, genuine economic or family-related reasons, arm's length conditions and the absence of a speculative nature. The absence of financing and high risks also plays a role.
Abnormal management: significant tax consequences
- The capital gain falls under Article 90, paragraph 1, 1° of the Belgian Income Tax Code 1992 (BITC 92).
- It is, in principle, taxed at a rate of 33%, increased by the additional municipal tax.
- The exemption for historical capital gains that already existed on 31 December 2025 cannot be applied.
For shares that have increased significantly in value over many years, classification as abnormal management can therefore have particularly serious consequences. Under normal management, however, the historical increase in value may remain outside the scope of the new tax. For shares acquired before 1 January 2026, the valuation reference date of 31 December 2025 is therefore particularly important.
Normal management does not always mean lower capital gains tax
Once it has been established that the transaction qualifies as normal management, a second question arises: does the seller, either individually or together with their family, retain control over the company to which the shares are transferred?
If so, the transaction may give rise to an internal capital gain within the meaning of Article 90, paragraph 1, 9°, a) of the BITC 92. The assessment should therefore not focus solely on the seller's individual position. Control exercised jointly with family members is also relevant.
Advance ruling 2026.0361 illustrates this. An entrepreneur contributed their shares to a newly established personal holding company, becoming its sole shareholder and sole director. Because the entrepreneur directly controlled the receiving holding company, the capital gain was classified as an internal capital gain.
Internal capital gains under normal management
- A taxable internal capital gain is, in principle, subject to a tax rate of 33%.
- A specific exemption may apply to certain contributions. In advance ruling 2026.0361, the internal capital gain could be temporarily exempted under Article 95 of the BITC 92, subject to the applicable conditions.
- A sale to one's own holding company and a qualifying contribution to that holding company are therefore not treated in the same way for tax purposes.
Where the seller personally holds less than 20% of the shares, the general tax rate of 10% applies in principle under normal management. An annual exemption of EUR 10,000 applies, subject to annual indexation. The unused portion may, under certain conditions, be accumulated up to a maximum of EUR 15,000. If the seller personally holds at least 20%, the special regime for substantial shareholdings may apply.
No control? A more favourable tax regime may apply
The situation is quite different where the seller holds at least 20% of the shares but does not retain control over the acquiring company, either individually or together with their family.
Under normal management, the capital gain may then qualify as a capital gain on a substantial shareholding in accordance with Article 90, paragraph 1, 9°, b) of the BITC 92.
Substantial shareholding
- EUR 1 million in capital gains is exempt.
- Progressive tax rates then apply, starting at 1.25% and rising to a maximum of 10%.
- The control arrangements following the transaction can therefore have a significant impact on the final tax burden.
When does the seller retain control?
Selling shares to a child's holding company does not automatically mean that the parents retain control. In advance ruling 2026.0495, parents sold their shares to their son's holding company. They exercised neither direct nor indirect control over that holding company. The fact that the father retained a directorship in an underlying company did not change this. The sale therefore fell under the substantial shareholding regime rather than the internal capital gains regime.
The family relationship alone is therefore not sufficient. It is necessary to examine whether the seller actually exercises control over the acquiring company, either individually or together with their family.
Holding 50% of a joint holding company does not automatically constitute control either. In advance ruling 2026.0463, two independent families combined their businesses. Each family held 50% of the holding company and was entitled to nominate three of the six directors. The portion of shares sold was treated as a substantial shareholding.
The specific shareholder rights, governance rights and governance arrangements are therefore more important than the family relationship or shareholding percentage alone.
Assess each step separately
A single restructuring may involve different tax regimes. In advance ruling 2026.0443, a shareholding was first contributed to a company controlled by the entrepreneur. This resulted in an internal capital gain. Subsequently, less than 50% of that company was sold to an external partner. This second transaction qualified as a sale of a substantial shareholding.
Each step of a restructuring must therefore be assessed separately.
What should you remember?
The four questions to ask, in the right order:
- Does the transaction qualify as normal management? If not, a tax rate of 33% applies in principle, increased by the additional municipal tax, without protection for historical capital gains.
- Does the transaction qualify as normal management, and does the seller retain control over the buyer, either individually or together with their family? If so, it may give rise to an internal capital gain, in principle taxed at 33%, unless a specific exemption applies.
- Does the transaction qualify as normal management, and does the seller personally hold less than 20% of the shares? If so, the general tax rate of 10% applies in principle, after the annual exemption of EUR 10,000, subject to indexation and, under certain conditions, accumulation up to a maximum of EUR 15,000.
- Does the transaction qualify as normal management, does the seller personally hold at least 20% of the shares, but does not control the buyer, either individually or together with their family? If so, the substantial shareholding regime may apply, with an exemption of EUR 1 million and progressive tax rates ranging from 1.25% to a maximum of 10%.
An apparently minor difference in the structure of a transaction can therefore lead to a substantial difference in the final tax burden. This distinction goes beyond tax rates. For capital gains realised under normal management, historical capital gains that already existed on 31 December 2025 remain, in principle, outside the scope of the new tax. This protection does not apply in cases of abnormal management.
Planning a share transfer?
Whether you are considering a sale, family succession or restructuring through a holding company, it is worth assessing in advance whether the transaction qualifies as normal management, the control arrangements following the transfer and the applicable capital gains tax regime. In cases involving substantial capital gains or complex governance arrangements, obtaining an advance ruling may also be a valuable option to gain greater legal certainty.
This article is based on advance rulings no. 2026.0361, 2026.0443, 2026.0463, 2026.0495 and 2026.0430.
