What is property tax?
Property tax is the yearly Flemish capital tax on immovable property, such as houses, land and commercial buildings. This tax is levied on the basis of the cadastral income of the property and is a fixed yearly cost for owners or users of these properties.
Examples of situations where property tax applies
- Home office: If you have a home office, part of the property tax can be deducted as a professional expense.
- Rented commercial space: For rented office or work spaces, the property tax may be passed on by the landlord.
- Commercial properties: Property tax for commercial buildings, such as a shop.
Property tax as a deductible professional expense
The costs of property tax can be considered professional expenses and therefore deducted from your taxes, provided they relate to your business activities. Here are some important points to keep in mind:
- Proportionality: If you use part of your home for business purposes, only the business portion of the property tax can be deducted. For example, if 30% of your home is used as an office, you can deduct 30% of the property tax as a professional expense.
- Documentation: Keep all property tax assessment notices and payment receipts.
- Accurate accounting: Ensure that your accounts are up to date and that you keep accurate records of all expenses. This will assist with tax returns and provide you with a clear summary of your business expenses. Use accounting software that specifically offers cost categories for taxes such as property tax.
How to treat property tax as a professional expense?
- Keep all tax assessment notices and payment receipts: Collect all proof of property tax and keep it in a safe place. This is crucial for accounting and tax returns.
- Calculate the business portion: If your home is used partly for business purposes, calculate the proportional portion of the property tax that relates to your business space.
- Register the expenses in your accounting system: Record the business portion of the property tax in your accounting system under the appropriate category. This makes it easier to deduct these costs on your tax return. Accounting software such as Dexxter offers a specifically designated cost category for property tax, so that this is immediately correctly stated on your tax return.
