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Non-profits · Money and obligations

Non-profit taxes and VAT: what you need to know in 2026

Updated on

A non-profit association (ASBL/vzw) is in principle subject to the legal entities tax: it is taxed only on a few types of income (property income, investment income, certain capital gains). If it carries on a profit-making activity, it moves to corporate income tax. And ‘non-profit’ does not mean ‘VAT-free’.

Legal entities tax or corporate income tax

A non-profit moves to corporate income tax if it engages in a business or in transactions of a profit-making nature. The following are not considered profit-making:

  • isolated or exceptional transactions;
  • investing the funds raised as part of its mission;
  • activities that involve commercial transactions only incidentally, or that do not use industrial or commercial methods.

What counts is the actual activity, not the stated purpose, and it is up to the non-profit to prove it: in 2025, the Brussels Court of Appeal made a non-profit subject to corporate income tax because its restaurant had a turnover of about €336,000.

Under the legal entities tax, a non-profit is taxed on certain income only: cadastral income, certain rents, investment income (through withholding tax on investment income), capital gains on property realised within 8 years, part of benefits in kind. It does not deduct its expenses. Since 1 January 2026, the new 10% tax on capital gains on financial assets also applies to non-profits subject to the legal entities tax, except those approved to issue donation certificates.

VAT

  • Some activities are exempt under Article 44 of the VAT Code: healthcare, social assistance, education, sports facilities run by a non-profit body, culture… Exemptions are interpreted strictly.
  • Other paid activities (bar, catering, rental, sales) are in principle subject to VAT. Below €25,000 of turnover a year, the non-profit can apply for the small business VAT exemption scheme.
  • Since 1 January 2026, invoices between VAT-registered Belgian businesses must go through Peppol, including businesses under the exemption scheme, except for transactions exempt under Article 44.

Frequently asked questions

Does a non-profit pay corporate income tax?

Only if it carries on a profit-making activity that is not incidental. Otherwise, it is subject to the legal entities tax, which covers only certain income.

Does a non-profit have to charge VAT?

Yes, for its taxable activities that are not exempt under Article 44, unless it opts for the exemption scheme below €25,000 of turnover a year.

What next?

The whole Non-profits section

Volunteers and workers
Money and obligations
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Sources

Parameters in force on 1 October 2026. Each parameter links to its source, the official one where it exists; a secondary source is flagged as such.