Belgium Pension Guide

First Pillar — State Pension (Wettelijk Pensioen / Pension Légale)

• Eligibility: The state pension is payable from 65 years (increasing to 66 in 2030) for both men and women. The minimum career duration for a full pension is 45 years (for retirement at 65). Early retirement (brugpensioen / prépension) is possible from age 60 with a career of 44 years. The amount is based on the average salary over the career (indexed) multiplied by the pension percentage (60% for single, 75% for couples with a dependent spouse).
• Taxation: State pension income is taxable as ordinary income at progressive rates (25–50%). However, pensioners receive an additional tax-free threshold (the "belastingvrije som" is increased for pensioners — approximately €3,000 extra). The pension is paid by the Rijksdienst voor Pensioenen (RVP / Service des Pensions).
• Maximum state pension: The maximum gross monthly pension for a single person is approximately €2,500–€3,000 (varies depending on the career history). For a couple filing jointly, the combined pension may approach €4,000–€5,000/month. These amounts are indexed annually.

Second Pillar — Supplementary Pensions

• IPT (Individuele Pensioentoezegging / Engagement Individuel de Pension — EIP): An individual pension commitment by the company to a director or senior employee. The company contributes to an insurance contract (tak 21 or tak 23). The contributions are deductible at the corporate level (25% saving) and are not subject to social security (neither employee nor employer share). The director is taxed on the pension capital at disbursement: 10% if the pension is paid as a lump sum at retirement (the "wettelijk tarief" / "taux légal") or 16.5% if the pension is taken earlier (before age 60). The capital may also be taken as a monthly annuity (the "renten" / "rente") — the annuity is taxed at progressive rates (25–50%) but a portion is exempt.
• VAPZ (Vrij Aanvullend Pensioen voor Zelfstandigen / Pension Libre Complémentaire pour Indépendants — PLCI): A supplementary pension for self-employed individuals (including directors under the RSVZ/INASTI regime). The annual contribution is limited to 8.17% of the professional income (with a maximum of approximately €10,000/year). The contribution is deductible from personal income tax (at marginal rates) and from the RSVZ social contribution base. The pension capital at disbursement is taxed at 16.5% (plus municipal surcharge).
• POZ (Pensioenovereenkomst voor Zelfstandigen / Convention de Pension pour Indépendants — CPI): Similar to VAPZ but with higher contribution limits. The POZ allows self-employed individuals to contribute up to 80% of their professional income to a pension (with a maximum of approximately €50,000/year). The contribution is deductible at progressive rates. The capital at disbursement is taxed as ordinary income (progressive rates) but a portion is exempt. The POZ is particularly useful for high-income self-employed individuals who've maxed out the VAPZ limit.
• Group insurance (Groepsverzekering / Assurance de groupe): A collective pension plan for a group of employees (or a category of employees). The employer contributes a percentage of salary to the plan. The employer contribution is deductible (25% saving) and not subject to social security. The employee receives a pension capital at retirement, taxed at the preferential rate (10–16.5%). If the employee leaves the company, the pension rights are preserved (the "behoud van rechten" / "maintien des droits") through the "pensioeninstelling" / "organisme de pension".

Third Pillar — Private Pension Savings (Pensioensparen)

• Pensioensparen / Épargne-pension: Individuals can contribute to a qualifying Belgian pension savings account (pensioenspaarfonds / fonds d'épargne-pension) or a life insurance policy (tak 21, tak 23). Two regimes exist: (a) Old regime (30%): contributions up to €1,270 per year are eligible for a 30% tax credit (reducing the tax due by up to €381/year). (b) New regime (25%): contributions up to €3,420 per year are eligible for a 25% tax deduction (reducing taxable income by up to €3,420, saving up to €855 in tax at the 25% bracket). The new regime is generally better for higher earners (40–50% bracket) because the deduction is from income, not a credit. The taxpayer must choose one regime — they cannot contribute to both simultaneously.
• Investment choice: The pension savings can be invested in: (a) a pension savings fund (pensioenspaarfonds / fonds d'épargne-pension) — a collective investment fund regulated by the FSMA (Autoriteit voor Financiële Diensten en Markten / Financial Services and Markets Authority), or (b) a pension savings insurance (pensioenspaarverzekering / assurance épargne-pension) — a life insurance policy (tak 21 — guaranteed return, or tak 23 — investment-linked).
• Taxation at disbursement: The pension capital is taxed at 10% if paid as a lump sum at the legal retirement age (65), or at 16.5% if taken earlier. If taken as an annuity, the income is taxed at progressive rates. The tax is a final withholding — no further personal income tax is due. The pension must be saved for at least 10 years to qualify for the favourable rate.

Pension Tax Summary — Comparison

• IPT (director pension): Corporate deduction (25% saving), no social security, capital taxed at 10% (at retirement) or 16.5% (early). Effective tax rate on the contribution: approximately 15–25% depending on individual circumstances.
• VAPZ (self-employed): Deduction at personal marginal rate (up to 50%), no social security on the contribution, capital taxed at 16.5%. Effective rate: approximately 33–50% deduction + 16.5% at exit = net benefit.
• Pensioensparen (third pillar): 25–30% tax saving on contribution, 10% at disbursement. Available to all taxpayers.

For related reading, see our DGA and Directors' Tax Guide →, Personal Tax Guide →, and Corporate Tax Guide →.