Deductible professional expenses: the basics
As a self-employed person or entrepreneur in Belgium, you have to deal with a lot of costs to pursue your profession. The good news? Much of it you can deduct from your taxes. So you often hear accountants say:
"You have to incur costs."
Why? Because professional fees give you net taxable income lower, and therefore your tax bill. But which expenses are deductible, and how exactly does it work? In this article, we'll give you an overview of the basics around deductible business expenses, so you can start work with peace of mind.
What are deductible professional expenses?
Professional expenses are expenses you incur to earn taxable income obtain or maintain. The more professional expenses you bring in correctly, the lower your taxable profit and therefore your tax burden.
⚠️ Not all expenses are deductible. The tax authorities distinguish between:
- Deductible professional expenses
- Rejected expenses (costs that the tax authorities do not accept or only partially accept)
Why are professional expenses tax deductible?
A simple example makes this clear:
- A baker achieves €100,000 in sales.
- He buys an oven for €20,000.
- He pays taxes on €80,000 instead of €100,000.
Logical, as he would not be able to bake bread without an oven. So the expense is necessary to obtain taxable income.
Does that same baker buy an €80,000 sports car? Then the deductibility more difficult to defend.
What does "insert costs" mean?
If your accountant says you must bring in more costs, he means that you should incur professional expenses that are deductible. That's how you reduce your taxable profit.
👉 Important: do this in moderation. There is no point incurring expenses that don't make your business stronger. Moreover, the tax authorities impose clear limits.
Which expenses are 100% deductible?
According to Article 49 ITC, expenses are deductible if they meet three conditions:
- Necessary for taxable income (e.g. an oven for a baker).
- Made during the taxable era (e.g. invoice in 2024 → deduction in 2024).
Evidence available (invoice, receipt or other evidence).
Examples of fully deductible expenses:
- Office supplies
- Insurance
- Supplementary pension
- Professional travel by public transport
- Specific work clothes (e.g. uniform, toga)
- Renting or paying off office space
- Social contributions
Which expenses are partially deductible?
Not all professional expenses can be fully deducted. Some are only partially deductible:
- Restaurant charges: 69%
- Corporate gifts: 50%
- Car costs: dependent on CO₂ emissions and type of vehicle (electric more favourable)
- Housing costs: percentage according to professional use
The non-deductible part is added to your profit → you pay taxes on it.
Contributing costs in secondary profession
Self-employed people in a secondary occupation are also allowed to deduct expenses, just as in a main occupation. They often involve mixed costs, e.g:
- Laptop or smartphone: partly private, partly professional
- Rent, electricity or heating: only professional part deductible
👉 Fully deductible in secondary profession: accountant, software, training...
Flat-rate professional expenses
As a sole trader, you can opt for a cost flat rate:
- Up to 30% of your gross profit (with ceiling of €5,750 in 2024)
- No supporting documents required
This system is useful if you have few real professional expenses. But in many cases, the flat rate is lower than your actual expenses.
Top 3 forgotten professional expenses
Many self-employed people miss out on money because they do not deduct certain expenses. Here the top 3 forgotten professional expenses:
1. Your home
Do you work from home? Then you are allowed to deduct a percentage of your expenses (water, electricity, mortgage interest). With rental properties, this is more difficult unless contractually stipulated.
2. Coaching and training
Business coaching, seminars and in-service training are deductible if they contribute to your business activities.
3. Clothing
Only specific professional clothing is fully deductible. A tailored suit is not, but a gown or uniform is.
Conclusion: do it in moderation and smartly
Deductible professional expenses are a powerful tool to reduce your tax burden. But:
- Ensure supporting documents.
- Only incur expenses that really contribute to your business.
- Don't forget mixed and often overlooked costs.
Want to make sure you don't miss any opportunities? With a good accountant by your side, make the most of deductible professional expenses.
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