Belgium Mortgage and Home Ownership Tax Guide

Mortgage Interest Deduction (Woonbonus / Bonus Logement)

• Mortgages concluded before 1 January 2020 (the woonbonus): For mortgages concluded before 1 January 2020, the woonbonus (the Flemish housing bonus) and the "bonus logement" (the Walloon/Brussels housing bonus) provide a tax reduction (not just a deduction) — the mortgage interest paid is deducted from taxable income at the marginal tax rate (up to 50%), with the maximum loan amount capped at €76,280 per person (the original "woonbonus" / "bonus logement" — increased to €96,000 in Wallonia and Brussels for energy-efficient homes). The borrower receives a tax credit equal to the lower of: (a) the actual interest paid, or (b) the maximum deductible amount (€2,290 per year for the principal loan, plus €1,520 for the supplementary loan — the "bijpassende lening" / "prêt complémentaire" for energy improvements). The woonbonus is applied automatically by the FOD Financiën / SPF Finances on the annual tax assessment.
• Mortgages concluded after 1 January 2020 (the new regime): For mortgages concluded after 1 January 2020, the woonbonus has been abolished in Flanders (no new tax benefit for mortgage interest). In Wallonia, the "chèque habitat" / "woonbonus" remains but in a modified form — the interest deduction is only available for the first €75,000 of the loan (the "premier prêt hypothécaire" / "eerste hypothecaire lening") and is limited to the first 10 years. In Brussels, the housing bonus was abolished for new mortgages from 1 January 2017, but the "abattement" on registration tax was increased to compensate. Transitional rule: Borrowers who concluded a mortgage before 1 January 2020 (or who had a "binding offer" before that date) continue to benefit from the woonbonus for the full duration of the loan (the "verworven rechten" / "droits acquis" — acquired rights principle).
• Long-term savings (langetermijnsparen / épargne à long terme): For borrowers who do not qualify for the woonbonus (post-2020 mortgages), the langetermijnsparen / épargne à long terme (long-term savings deduction) may apply. The deduction allows a tax reduction on: (a) mortgage principal repayments (not just interest) — up to €2,350 per year (indexed), (b) life insurance premiums related to the mortgage (the "schuldsaldoverzekering" / "assurance solde restant dû"). The tax reduction is at the marginal rate (25–50%). The deduction is available for the first 10 years of the mortgage and is capped at the Schumanplan rate (the reference rate set by the FOD Financiën).

Registration Tax (Registratierechten / Droits d'Enregistrement)

• Flanders (Vlaanderen): The registration tax on the purchase of a primary residence (the "eigen woning" / "habitation propre") in Flanders is 3% on the first €200,000 of the purchase price (the "verlaagd tarief" / "taux réduit" — the reduced rate for the primary residence). Above €200,000, the standard rate of 10% applies (for existing properties) or 21% VAT (for newly built properties — the "nieuwbouw" / "construction neuve"). The reduced rate of 3% is available to: (a) first-time buyers (the "startersbonus" — the 3% rate on the first €200,000), (b) buyers who own no other property, (c) buyers who will occupy the property as their primary residence for at least 5 years. From 1 January 2022, the Flemish government increased the first tranche to €200,000 (from €160,000). The "meeneembaarheid" / "portabilité" — the transferability of the reduced registration tax — allows a buyer who sold a previous primary residence to transfer the unused portion of the reduced rate to the new purchase.
• Wallonia (Wallonie): The registration tax in Wallonia is 12.5% on the purchase price of existing properties. For the primary residence, there is an abatement (the "abattement" / "korting") of €20,000 on the first tranche of the purchase price — meaning the first €20,000 of the taxable base is exempt from registration tax. The effective rate on a €200,000 property is approximately 11.25%. The abatement is available to: (a) first-time buyers, (b) buyers who will occupy the property as their primary residence, (c) buyers who have not owned a property in the last 5 years. Newly built properties are subject to 21% VAT instead of registration tax.
• Brussels (Bruxelles / Brussel): The registration tax in Brussels is 12.5% on the purchase price. For the primary residence, a substantial abatement of €175,000 applies from 1 January 2022 (the "abattement" / "korting" — increased from €60,000 to €175,000 by the Brussels government). The abatement is available to: (a) buyers who will occupy the property as their primary residence (the "hoofdverblijfplaats" / "résidence principale"), (b) buyers who have not owned a property in the last 5 years. The effective rate on a €300,000 property after the abatement is approximately 6.25% ([€300,000 – €175,000] × 12.5% = €15,625 ÷ €300,000). The abatement can only be used once in a lifetime.

Annual Property Tax (Onroerende Voorheffing / Précompte Immobilier)

• Calculation: The onroerende voorheffing / précompte immobilier is an annual property tax calculated on the indexed cadastral income (KI/RC). The tax is composed of: (a) the regional rate — approximately 1.25% (Flanders), 2.54% (Wallonia), or 3.97% (Brussels) of the indexed KI, (b) the provincial surcharge (the "provincieopcentiemen" / "centimes additionnels provinciaux") — typically 200–400% of the regional rate, (c) the municipal surcharge (the "gemeenteopcentiemen" / "centimes additionnels communaux") — typically 1,000–2,000% of the regional rate. The total effective rate is approximately 2.5–7% of the indexed KI. For example: a house with a KI of €1,500 in a Flemish municipality with 1,500 municipal surcharges would owe approximately €1,500 × 1.25% × (1 + 15.0) = €300 per year.
• Reductions and exemptions: Several reductions apply: (a) children reduction — €75 per dependent child (up to 4 children), (b) reduced means reduction — for low-income households (the "vermindering voor bescheiden woning" / "réduction pour habitation modeste"), (c) renovation exemption — the property tax may be temporarily reduced (for 5 years) after a major renovation (the "renovatiepremie" / "prime à la rénovation"), (d) energy exemption — energy-efficient properties (EPC label A or B) may qualify for a temporary exemption. The reductions are applied automatically by the region.

Cadastral Income (Kadastraal Inkomen / Revenu Cadastral)

• The KI/RC in the tax return: The cadastral income (KI/RC) is the deemed annual rental value of the property as assessed by the FOD Financiën / SPF Finances. The KI is included in the personal income tax return and taxed at the progressive rates (25–50%). The KI is indexed annually (the "indexering" / "indexation" — approximately 2–4% per year based on the health index). The KI is added to the taxpayer's other income and taxed at the marginal rate. For a property that is the taxpayer's primary residence, the KI is taxed but the tax is reduced by the onroerende voorheffing already paid (the property tax is creditable against the personal income tax on the KI).
• Rental income vs KI: If a property is rented out, the actual rental income is NOT directly taxed (except for the portion exceeding the KI by more than 66%). The tax is based on the indexed KI — even if the actual rent is much higher. However, if the actual annual rent exceeds the indexed KI by more than 66%, the excess rent is added to the KI for tax purposes (Article 7 of the WIB/92). For example: KI = €2,500, actual rent = €6,000. The threshold is €2,500 × 1.66 = €4,150. The excess is €6,000 – €4,150 = €1,850. The taxpayer is taxed on KI + excess = €2,500 + €1,850 = €4,350.

For the full property tax framework, see our Property Tax Guide →. For the real estate investment implications, see our Real Estate Investment Guide →. For the official rates, see the FOD Financiën property tax portal.