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KBC goes to Maasmechelen ABRA Society Page Belgium: a good investment
HOT Issues VAT in 2010
HAPPY BIRTHDAY RELOCATE !
This last year has positively flown by and even 2010 is already well underway at the time of putting the proverbial ‘pen to paper’. INSIDE THIS ISSUE: Introduction
The down-turn in the economy has left its mark on companies and people around the world, however, slowly but surely we are starting to see some positive signs and even an upturn in certain areas. And so we look forward to what this new year might bring us as we remain ever hopeful of times to come!
In fact, the world of business and enterprise is a global world. As professionals in the relocation industry we’ve known this for quite some time! However, this globalization is now also reflected in some very important changes in the way we pay value added tax. Ivan Massin, partner at Deloitte brings us the latest updates in this issue.
approved rental contracts HOT Issues in relocation International VAT
legislation update 2010
a good investment ABRA Society Page
KBC styling day
in Maasmechelen Village Dates for your Diary 8
Meanwhile ABRA has continued to grow as an association as well as a body of influence. In our very first edition of ReLocate magazine we spoke about our aims and objectives as an organization. ABRA aims to promote the concept of relocation, professionalize what was once viewed as a ‘hobby sector’ and build and maintain links with other organizations and associations as well as being a voice for all with an interest in the relocation industry. We’ve had some very successful meetings resulting in the ‘Fast Track’ system for expatriates to Belgium and have become a voice to be heard. We are now over 60 members strong and the range of members keeps growing. With growth comes change and one of the hottest issues in our industry today is the merge between real estate and relocation. Much is to be said for and against this change. Anita Meyer of am-pm Relocation and Deborah Loones of Relocation Belgium consider the pros and cons in ‘Hot Issues’. Welcome to our latest members, welcome to all our readers and of course I hope you will join me in saying ‘Happy Birthday’ as we celebrate ReLocate Magazine’s first birthday with a brand-new look!
ABRA approved rental agreements Moving abroad can be complex enough at the best of times. In order to help alleviate problems faced by expats wishing to rent accommodation in Belgium, ABRA has worked together with the Chambre d'arbitrage et de médiation on developing clear, new rental contracts. ABRA provides a copy of the contract (Brussels area, the leases from the Flemish and French areas differ slightly) in French and Flemish so that members can ensure that they are using the most up-to date copies of the contract. An English translation (also Brussels area) is available to read in the Members' Area of our website. The Member’s Area is accessible to our Full and Local Members, you can find the forms through www.abra-relocation.com > news. To receive a copy please contact email@example.com .
With special thanks to our sponsors for their continued support Cover photograph: Fiona Klomp Raspberry Meringue by ‘Le Pain Quotidien’
HOT Issues: relocation and real estate
One of the hottest issues in the Belgian relocation industry today is the ‘marriage’ between relocation and real estate agencies. Everyone has an opinion on the matter and feelings can run quite high as change sets in to the way we do business. It’s important to bring the discussion out into the open and consider the pros and cons carefully. Anita Meyer of am-pm relocation and Deborah Loones of Relocation Belgium discuss: “Obviously as a Relocator you can see the potential of moving into real estate, it’s a great way of expanding your business. You know what the client wants and your personal selection of real estate will be closest to their needs.” “However, as a Relocator you represent your client, the ‘tenant’. Real Estate Agents represent the owner or party letting the property. How can you offer both parties the very best service when each has opposing interests and needs? Surely properties in your own portfolio will get preferential treatment so how is this fair towards the transferee?”
PROS: Historically speaking relocation grew from the real estate industry. A number of US real estate agents realized back in the 40’s that setting up a new home was more than simply choosing a house and unpacking boxes. Hesitantly they started offering other services that would later come to stand alone: thus the relocation industry was born. It seems logical to return to the roots of our industry. Real estate agents don’t hesitate to offer relocation services, just have a look at their websites. Why allow ourselves be constrained when others don’t hesitate to expand into new areas of business? In a dog eat dog world, we must look into all areas to ensure the growth of our companies. Real estate agencies get the first months’ rent as a commission yet in all reality the relocation agents often do their job for them. How often does it happen that the real estate agent is too busy to show all the properties? The relocator picks up the keys and does all the work. Why shouldn’t the relocator pick up this commission as well? It only seems fair.
CONS: The reason for this separation of real estate and relocation services was the conflict of interests: with your own real estate office it’s very tempting to favour your own lettings portfolio to the client moving house, perhaps even giving them a slight nudge in the direction of that one particular property. Whilst this is true, just like the moving companies who offer relocation services, mixing interests often mean these agencies don’t do as well as they could. It’s a separate industry. Real estate is very commercial, and is all about the sale, whereas relocation is a gentler way of doing business, taking all factors surrounding a move into account, not just the commission. In a way it’s closer to, for example, Human Resources. A real estate agent represents the interests of the owner of the property and is rewarded by means of a commission of this first month’s rent. A relocation agent represents the interests of the expat or tenant and receives a set amount in remuneration from the employer of the expat. Surely it seems wrong to represent the interests of both parties and receive payment from two ‘opposing’ sides. The interests of the owner and tenant are diverse and often even polar opposites. A neutral relocation agent with diplomatic qualities has the job of reconciling these differences, leading to a win-win situation.
ABRA believes it is important to take on board the views of our members, we are after all an association run by, and for, our members. How do you feel about the ‘marriage’ between relocation and real estate? Are you for, against, or do you not mind either way? We value your opinion on the matter and would like to bring this debate into the open, and so will be opening a forum which will allow everyone to have their say. We do ask that your reactions are well formulated and you do not become personal in your response. Reactions may be sent to firstname.lastname@example.org for consideration.
VAT package 2010 FOTO
The addition of Value Added Tax is an important part of billing, and as a standard companies are required to charge VAT on their products or services. However when dealing with foreign business, VAT needn’t be applied. Mostly, we felt we knew what the rules were, however new legislation has been approved for national and international business. So what changes can we expect for 2010? Ivan Massin, Partner at Deloitte was kind enough to clarify these changes at our Members Meeting at Antwerp International School in December 2009. For those of you who may have missed the presentation, or who would like a recap we are delighted to bring you this article as well as a handy cut-outand-keep guide!
On January 1st 2010 new legislation came into practice. What has essentially changed? The place of supply rules, the formalities surrounding correct bookkeeping and the refund procedure on foreign VAT. Place of Supply rules Place of Supply rules determine which VAT is applicable in an international context when the service provider and the service recipient are located in different countries or if the service is carried out abroad from where the assignment originated. Until recently the service provider was required to bill VAT in accordance with the rates of the country they are located in. An exception to this rule were the ‘intellectual’ services (i.e. advisory services) and real estate related services. When billed to a foreign business, advisory services are not subject to Belgian VAT. However, the question was what was exactly meant by ‘advisory’ services. In other words, the question for relocation agents was therefore what exact service they provide. Is it solely advisory or also administrative? If in doubt the safest bet was to charge Belgian VAT.
This VAT may be recoverable for the French company. In that case, there is not net cash payment of VAT because the ‘payment’ of the VAT is set-off against the recovery of this VAT in the same VAT return. The net result thus is nil (except if the French company cannot recover this VAT amount in full). Important to remember is that the company providing the service has no VAT obligations whatsoever in the country of the recipient business. B2B regulations VAT must be paid on any service in the country where it is received in accordance with the new international reverse charge rules. So just like French VAT must be paid in the above example, so must Belgian VAT be paid if for example services have been rendered here by an American company. These regulations apply to ALL types of service, including intellectual services such as advisory or negotiations. This is a change from before when only ‘intellectual’ services were subject to this rule.
Definition of B2B and B2C In order to streamline the charging of VAT and get rid of any ambiguities new definitions of Place of Supply rules have been introduced. A distinction has been made between B2B (business to business) and B2C (business to customer) assignments. ‘B’ or business can mean any type of business, but also hospitals, schools (VAT exempt) and even public bodies such as councils and municipalities (providing they have a VAT number). ‘C’ or customers are private individuals and public bodies that don’t have a VAT number. Whether they’re in- or outside of the EU bears no relevance here, it is a global rule. Reverse Charge regulations Under the new system a ‘reverse charge’ has been established for VAT on B2B business. This means that the recipient business is required to pay the local VAT due on a service if the service providing company is not registered for VAT in that same country. So for example, if a Belgian company renders services in France, the Belgians needn’t add VAT to their charges. The French company however must report the French VAT payable on the invoice via their local VAT return form.
B2C regulations VAT on services rendered must be paid to the country of the service provider and not the recipient. For example if a Belgian company does business with an individual in France Belgian VAT must be added to the invoice. A Swiss citizen will also be charged this Belgian VAT. VAT must be charged on all services rendered. However, for B2C, there is an exeption for intellectual services, when the customer is established outside the EU; in that case, no VAT should be applied. continued overleaf >>>>
>>>> from p. 4 There is one exception to this rule however, services related to real estate do NOT fall under this new legislation either for B2B or B2C transactions.
CUT OUT AND KEEP GUIDE TO FILLING OUT YOUR TAX RETURN VAT Outgoing
Box 44 (new) The Relocation Sector If your business is not linked with real estate there are some simple rules to follow. The content of your service (intellectual or otherwise) is not relevant to whether or not you must charge VAT. You needn’t charge it, but the receiving party must declare the value of local VAT in their tax returns. So what do I need to do? Ask your customer for their VAT number so that you may include it on any invoices and in your tax return. For companies in the EU you can check on this number via VIES website (just ‘google ‘VIES’ to find the website) for their certificate. For non-EU companies: due diligence. The VAT form Intra-community services – i.e. services rendered to a foreign EU business – must be reported in a new box in the VAT return. In addition, these services are to be reported in a new listing for intracommunity servies which is to be filed together with the VAT return. What goes in the listing? all intra-community supplies of goods all intra-community services rendered What needs to be reported? customer VAT number Taxable basis of all supplies during the period Code ‘S’ (stands for Services) or ‘G’ (stands for Goods) Your VAT returns can be filed monthly or quarterly like always. The hardest part will be getting used to the changes, but the new system will make invoicing and taxes a lot more transparent in the long term. Unfortunately this does also mean an update to your accounting software so make sure that your accounting department is up to date on the changes. Things to watch: new tax codes (see cut out and keep guide) New reference on invoice, e.g. “No application of Belgian VATart. 44 VAT directive - Reverse Charge - Art. 196 VAT Directive”. Computer generated paper VAT return is no longer allowed, using INTERVAT system is mandatory. Review all customer master data (missing VAT numbers, etc.) Be careful with late 2009 / early 2010 filing in February 2010 as this is the change-over period!
List any services and their commercial value provided to companies in other EU countries that are not exempt from VAT. Box 47 List any services and their commercial value provided to nonEU companies. Box 48 List any credit notes to EU companies. Box 49 List any credit notes to non-EU companies. VAT Incoming
Box 88 (new) List all services you have received from foreign EU provider Boxes 55/59 List any VAT payable and any deductible on services received from EU countries that are not exempt in Belgium (see box 88). Box 87 List all non-EU services received from foreign non-EU providers Boxes 56/59 List any VAT payable and any deductible on services received from non-EU countries that are not exempt in Belgium (see box 87). Box 84 Any credit notes from EU. Box 85 Any credit notes non-EU Boxes 61/62 List any VAT payable and any deductible on credits notes reported in boxes 84 and 85.
Belgium ranks highly with Japanese “As many studies confirm, Belgium is one of the best countries for foreign investors.” states the Belgium-Japanese Association & Chamber of Commerce (BJA). Seventeen separate reports on the investment climate, comparing Belgium to its neighbouring countries, show that Belgium scores highly on a number of points. This in contradiction to recent reports that Belgium was dropping in popularity. Research was done into four areas: globalization, attractiveness for headquarters, strength in logistics and quality of research and development. Criteria vary from the quality of education to internationalization and from productivity to taxes on invested capital.
Across you will find your ‘cut out and keep’ guide to these changes. Good luck and happy accounting!
In each of the seventeen studies Belgium scores “acceptable” to “good”. Only in the so-called ‘Nations Brands Index’, which rates how strong the brand value of a country is, does Belgium trail at the back. ‘This show the gap between reality and perception,’ says director Anja Kellens of BJA.
For any further information please do not hesitate to contact Ivan Massin, via email@example.com or 02 600 6000. www.deloitte.com
This is good news for the Belgian relocation industry as it confirms what we’ve always known: Belgium is an attractive country for foreign investment! Sources: De Standaard / De Tijd 3-4 Februari 2010
The ABRA Society Page
Neither the freezing cold nor the driving rain could keep our members away from our December meeting at Antwerp International School! We were rewarded by a stunning vocal performance by one of their students as well as moving speeches by Mihaela Andronic of Alcatel-Lucent, Nathalie Van den Bossche of Atlas Copco Airpower on relocating and of course last but certainly not least Ivan Massin of Deloitte. Our thanks to everyone involved for making it an evening to remember...
KBC goes to Maasmechelen!
We all know how important first impressions are. Within a few seconds of meeting someone we’ve already formed an opinion about the person we are talking to… The clothes we wear, the colours we choose al say something about us. We hope we make a positive impression, but we all have that one item: brand-new, never worn and stuck in the back of the wardrobe. It looked good in the shop, but where did we go wrong and why does it make us look so terrible? KBC and Maasmechelen Village offered 10 lucky winners the opportunity to find out how to dress for your shape and colouring and bring out the very best in you during a personal styling presentation in February. A photographic journey….
ABRA is delighted to introduce our latest members:
Dates for your Diary
Tuesday 23rd March 2010 - ABRA Members Meeting Time: 16u30 - 19u30 Guest Speaker: Michael Wincott, Director GES - Global Mobility Compensation Services at Deloitte Location: Aspria, Avenue Louise 71B, 1050 Brussels 21st - 23rd April 2010 - 12th International Relocation Congress Palma de Mallorca “Inspiration, Dedication, Re:Creation” visit www.eura-relocation.com for further details 1-2-3 and 4-5-6 September 2010 - Coaching Connections, a revolutionary programme developed by EuRA and Oxford Brookes University for relocation professionals. 12th October 2010 - SAVE THE DATE! “Expatriation: a look at the future” an exclusive event for top management and HR professionals brought to you by ABRA FURTHER ABRA MEMBERS MEETINGS: Tuesday 25th May 2010 Tuesday 21st September 2010 Tuesday 14th December 2010
Belgian Relocation Center Affiliate Members: TVFromHome AIRINC Infogate St John's International School Belgian Relocation Center DVM Furnished Housing Conrad Hotel Deloitte Manpower If you would like to see your event listed in ReLocate, or for further information on advertising, please contact firstname.lastname@example.org with the details. ReLocate is published quarterly, in March, June, September and November. www.abra-relocation.com
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The official quarterly publication by the Association of Belgian Relocation Agents. For HR professionals, Global Mobility Managers, Relocati...