A customer sends you a donation of €20 because they are happy with your work. Or perhaps one of your followers wants to support you. In Belgium, this amount is usually treated as business income.
Here’s how to tell: does the donation stem from your self-employed activity? If so, register it as turnover. Does it come from family or friends with no connection to your business? If so, it remains a private matter and you do not register it in your accounts.
Do you need to charge VAT? 🧾
No. A donation is not a sale. You do not need to charge VAT.
What you can and cannot do:
- Record the donation in your accounts as turnover.
- Do not include it in Schedule 00 of your VAT declaration.
Example:
A customer sends you a €50 tip as a thank you for your excellent service. You record it in Dexxter under manual input as income with the comment “gift received, no VAT”. Done. You don’t need to do anything else in your VAT declaration.
Impact on your personal income tax 💰
The tax authorities look at your total profit from your sole proprietor business. All income related to your business increases your taxable income.
Examples
- You received three payments of €100.00 via your website.
- You added €300.00 to your business income.
- You pay tax on this additional amount.
Private gifts from family or friends are not included here. These remain private and do not increase your taxable profit.
How do you prove that it really is a gift?
The tax authorities may always be curious. It is useful if you can then demonstrate that there is no sale or service behind the gift.
Tips:
- Ask the donor to write “gift – no consideration” on the bank transfer.
- Keep emails or messages stating this.
- Make a brief note in your accounts: “gift received, no sale”.
This way, you can prove later that you have handled it correctly.
What if you process it incorrectly? ⚠️
Many self-employed people think that a gift is always private. That is not correct.
Are you leaving a business-related gift out of your accounts? Then you risk corrections or fines.
Are you recording a private gift as turnover? Then you are paying unnecessary taxes.
The solution: make a clear distinction between business-related and private.
Tips for registering donations smartly 📋
- Use Dexxter to register donations correctly. That way, you don’t have to figure it out yourself.
- Always note the source of the donation. Customer, follower or private?
- Keep a brief description. For example: “Donation from customer via website, no VAT”.
- Check your declarations for clarity. This way, you’ll avoid surprises later on.
In a nutshell 🌰
Donations as a sole proprietor can sometimes cause confusion. Fortunately, it’s quite simple if you follow a few guidelines:
- Donation from a customer or follower: record it as turnover, do not charge VAT and include it in your taxable income.
- Donation from family or friends: do not record it in your accounts; it has no tax implications.
- Keep proof: add a comment to the bank transfer or briefly note in your accounts that it is a donation. That way, no one can ask afterwards: “Is this turnover or not?”
- Keep it organised: with Dexxter, you can neatly organise everything, keeping it simple and clear, without any hassle.
Useful URLs 🔗
Sponsorship & donations as a sole proprietor?
Everything you need to know about personal income tax as a self-employed person
