News article

Belgium’s Circular 2025/C/23 – Right to deduct

VAT News – Belgium

Belgium’s Circular 2025/C/23 implements European case law on the late exercise of VAT deduction rights, particularly following the Volkswagen AG and Biosafe rulings. These judgments clarified that VAT deduction cannot be denied solely for being late if the taxpayer was objectively unable to exercise the right within the standard limitation period.

In Belgium, this period is three years after the end of the calendar year in which the VAT became chargeable. While the circular acknowledges this case law, it applies it rigidly. VAT may only be deducted in the period when the corrective document is received and only under strict cumulative conditions and only if the supplier has paid the additional VAT. The right is limited to the additional VAT due under a corrected invoice; any originally invoiced VAT remains subject to the standard limitation.

The circular furthermore introduces additional reporting obligations. Taxpayers invoking the Biosafe exception must inform the tax authority in advance and clearly reference the circular in their VAT return. Details such as the deductible amount, corrective document number, and applicable VAT boxes (81–83 and/or 62) must be provided. A limited tolerance is allowed for documents received just before the limitation period expires, if timely declared.