In these challenging times, we’d like to outline a number of possible support measures for you as an employer. We highlight the fact that the below mentioned measures only relate to the employment of your employees. You may also be eligible for other measures with regard to corporate tax, VAT, etc. Further on, we can’t emphasize enough that the Belgian government adjusts these measures as much as every day. This newsletter reflects the state of affairs on April 16th, 2020.
'We can’t emphasize enough that the Belgian government adjusts these measures as much as every day.'
Under certain conditions, you can apply for temporary unemployment for the employees you can no longer employ full or part time due to the Corona crisis. By introducing this temporary unemployment benefit, you temporarily suspend the employee’s employment contract. The Belgian government has introduced a simplified procedure, which originally ran until 6 April but has since been extended until 31 May 2020. Please note that this is only one measure taken by the Belgian government and that there are still measures to which you may have recourse. Furthermore, we cannot stress enough that the Belgian government regularly adapts these measures.
Not every employer can claim this temporary unemployment. Only those employers who are directly affected by Covid-19, as a result of which the employees can no longer perform their duties at all or only partially, can make use of this specific procedure. Examples are: a shop has been closed, sales representatives can no longer visit customers and do not have enough tasks to perform at home, orders are no longer coming in,…
Not all employment contracts should be suspended. Only those employees who cannot work more or less because of their position are eligible for this. If, as an employer, you wish to apply for temporary unemployment, you can do so via a simplified procedure until 31 May 2020. This means that you let your Payroll Business Partner know which days the employees will work and which days they will be unemployed. Pro-Pay takes care of the necessary electronic declaration of these days of unemployment so that the NEO knows to which benefit the employee is entitled.
It is possible to suspend the employment contracts either completely (the employee no longer works) or partially (the employee still works one or more days per week). If partial unemployment is chosen, the employer determines how many days the employee can still work. The employees do not have to agree to this. Of course, they do have to be informed about the days they still have to work and which days they will be unemployed. This notification to the employees can take any form, an e-mail may be sufficient in some cases.
Workers who are temporarily unemployed must contact either their trade union (if they are affiliated to it) or the “Unemployment benefits fund” in order to open a file and obtain unemployment benefits. You can open a file at the “Unemployment benefits fund” online. The union or the help fund will then pay the unemployment benefits into the worker’s bank account on a monthly basis. Unemployment benefits amount to 70% of the gross monthly salary. However, the gross wage is limited to EUR 2,754.76. In addition, the unemployment office pays EUR 5.63 per day of unemployment. On both amounts 26.75% withholding tax is withheld.
In some sectors, there is an additional obligation to pay a supplement on top of this unemployment benefit. In addition, it is possible to pay a supplement voluntarily. This supplement can be granted free of social security contributions on condition that the total of the unemployment benefit + the supplement(s) does not exceed the taxable salary that the employee would have earned if he had worked.
If the employees are partially unemployed, they receive their normal salary for the days they work. Temporary unemployment days will be assimilated for pension purposes. Currently, there is no equivalence for the accrual of holidays and holiday pay, but according to various press releases, there would be a legislative initiative to put this on an equal footing.
With regard to the assimilation of end-of-year bonuses and other benefits granted at sectoral level, it will be necessary to examine what has been agreed within the Joint Committee. It cannot be ruled out that agreements will still be concluded in the sectors to assimilate this exceptional period to effective performance if this was not already the case.
Attention: if the employees only work at home and previously received an expense allowance because they had a mobile function, this expense allowance can no longer be granted. Instead, the government has increased the monthly reimbursement for office expenses (see further down).
The authorities grant a two-month deferment of payment of the withholding tax on earned income.
• Payment period withholding tax on earnings February 2020 extended to May 13, 2020
• Payment period withholding tax on earnings March 2020 extended to June 15, 2020
• Payment period withholding tax on earnings April 2020 extended to July 15, 2020
• Payment period withholding tax on earnings 1st quarter 2020 extended to June 15, 2020
In addition to this deferral, you can also apply to receive an exemption from default interest or remission of fines, or request a repayment plan. Such an application must be submitted before June 30, 2020. Note: this does not happen automatically! Contact your Payroll Business Partner for assistance.
As far as the employer’s contributions for social security are concerned, different support measures apply. Companies that are closed on government order can benefit from an automatic deferment of payment of social security contributions until December 15, 2020.
Companies that are not obliged to close but that suffer from the Corona crisis economically can apply for a deferment of payment of social security contributions until December 15, 2020 provided they submit a motivated application file with the social security authorities. Apart from the deferment of payment, an amicable payment plan is another option offered by the NSSO to companies in difficulties.
Office Costs and NSSO
Employees who work from home on a structural and regular basis can receive compensation from their employer for this. Since the costs related to working from home are relatively small and difficult to prove, the NSSO accepts that these costs are estimated on a flat-rate basis. For a number of costs, including the compensation for homeworking, the NSSO itself has fixed lump sums, as well as the conditions that apply to the granting of these lump sums.
The fixed compensation that the NSSO uses for office costs covers the costs of heating, electricity, small office equipment, insurances,… The allowance may be granted to employees who do not have a workplace with the employer or – if they do have a workplace with the employer – when their position shows that they work from home on a regular basis.
Employees who previously did not work from home, but are now forced to do so by the Covid-19 measures, can also be granted this compensation without the employer having to conclude a formal teleworking agreement with the employee. This is also possible if the employee works partly from home and is temporarily unemployed.
In addition to this maximum amount of €129.48, the employer can also compensate the following matters on a lump-sum basis:
∞ €20 per month if the employee uses his/her own PC for professional purposes;
∞ €20 per month if the employee uses his/her private internet connection for professional purposes.
Of course, these lump sums can only be granted if the office and internet costs are not reimbursed to the employee in any other way. Please note that the NSSO also uses other fixed amounts for forms of teleworking and homeworking besides the fixed amount for office costs, which are not discussed in this newsletter.
The Tax Authorities
The reimbursement of €129.48 for office expenses can be granted free of social security contributions if the conditions for granting the allowance have been met. The tax authorities do not have a similar official position regarding a fixed amount for office costs, but often follow the position of the NSSO on this matter.
However, if you want certainty from a tax point of view about the application of a fixed amount for the reimbursement of office costs, a ruling must be requested from the tax administration. The ruling service of the tax authorities has provided a simplified procedure specifically for obtaining a ruling for the reimbursement of telework during the corona crisis.