Portugal vs Belgium: The European Tax League, Edition 7

The European Tax League — a series comparing Portugal's IFICI expat tax regime against the best equivalent regime in one European country. Same rules every time: €500K salary, best available expat regime, no cherry-picking.

Spoiler: Belgium has one of the highest tax rates in Europe. They know it. They tried to fix it. It's still not enough.

50% federal top rate. Add communal surcharges and you're looking at effective rates in the low-50s% in high-tax communes. Welcome to Brussels. Please leave your wallet at the door.

To be fair — Belgium saw the problem. They built a fix. The Special Tax Regime for Inbound Taxpayers (STRIT), introduced in 2022 and significantly enhanced in 2025, is a genuine attempt to stay competitive for international talent.

But when you put it next to Portugal's IFICI, the structural weaknesses become clear fast.

Round 1: What Belgium brings to the table

Belgium consistently ranks among the highest-taxed countries in the OECD for employment income. The federal progressive scale tops out at 50%, and communal surcharges — calculated as a percentage of the federal tax due — can add up to approximately 9% more in high-tax communes. For a senior exec on a €500K salary, the effective combined rate without any relief lands in the low-50s%.

Belgium's answer is STRIT — the Special Tax Regime for Inbound Taxpayers. Here's how it works:

🇧🇪 Brussels — STRIT at a glance:

• 50% federal top rate + communal surcharge up to ~9% — effective rate low-50s% in high-tax communes

• Up to 35% of gross remuneration treated as tax-free allowances (enhanced from 30% in January 2025)

• Minimum salary: €70,000 gross (reduced from €75,000 as of January 2025)

• Duration: 5 years from first employment date in Belgium, with a possible 3-year extension (up to 8 years total)

• Must not have been a Belgian tax resident or lived within 150km of the Belgian border in the previous 60 months

• Employer must apply within 3 months of the employee's arrival

The 2025 enhancements are meaningful — the increase from 30% to 35% and the removal of the €90,000 cap on the tax-free allowance make STRIT more attractive for high earners than it was before. Belgium is trying.

One important nuance: the 35% is treated as a tax-free expense allowance rather than a simple income exemption, and the social security rules were not updated alongside the 2025 tax changes. In practice, this means the social security treatment of amounts above certain thresholds requires careful handling.

Round 2: What Portugal brings to the table

🇵🇹 Lisbon — IFICI at a glance:

• 0% on qualifying foreign income for 10 years (subject to income structure and applicable treaties)

• 20% flat on Portuguese source income — no matter your salary

• No salary cap on the 20% rate for qualifying income

• 10 years — up to double Belgium's maximum duration

• Generally not employer-tied — though qualifying activity and employer type must be maintained

• No wealth tax (note: AIMI applies to high-value real estate)

The structural differences are significant. Portugal gives you a 20% ceiling on everything you earn in Portugal, plus 0% on qualifying foreign income, for 10 years. Belgium gives you a 35% tax-free allowance on your gross remuneration — meaning you're still paying Belgian progressive rates on the remaining 65% — for up to 8 years maximum.

For a working founder or senior exec earning their salary in the country they live in, the gap is wide from day one.

Round 3: The numbers

Illustrative figures based on qualifying employment income under standard assumptions. Individual outcomes depend on income structure, commune of residence, personal circumstances, social security treatment, and applicable rules.

On a €500K salary:

· Brussels (STRIT, best case) · Lisbon (IFICI)

Effective rate without regime · Low-50s% · 48% + solidarity surcharge

Relief mechanism · 35% of remuneration as tax-free allowance · 20% flat rate ceiling

Effective rate with regime · ~35-40% on full salary · 20% flat

Rate on qualifying foreign income · Standard Belgian rates · 0% (qualifying categories)

Illustrative take-home · ~€300K-€320K · ~€400K+

Duration · 5+3 years (max 8) · 10 years

Employer-tied · Yes — employer applies · Generally no

Illustrative gap: ~€80K-€100K per year in favour of Portugal — from day one.

The year 9 problem

Belgium's STRIT lasts a maximum of 8 years with the extension. After that, you're a standard Belgian resident paying low-50s% effective rates on everything.

Portugal's IFICI lasts 10 years. After Belgium's regime expires, your Lisbon counterpart still has 2 more years at 20% flat plus 0% on qualifying foreign income.

And throughout those 10 years, the foreign income advantage compounds. A founder with significant holdco income, capital gains, or dividends structured correctly in Portugal could be paying 0% on that portion — while their Brussels equivalent pays full Belgian progressive rates on the same income.

The 150km rule — an unusual catch

Belgium has a condition you won't find anywhere else in this series: you must not have lived within 150km of the Belgian border in the 5 years prior to arriving.

For a founder moving from the Netherlands, Germany, Luxembourg, or northern France — that's a real disqualifying condition. Antwerp is 48km from the Dutch border. Brussels is 100km from the German border.

Portugal has no equivalent geographic restriction. Live anywhere in the world for the past 5 years and you qualify — as long as you weren't a Portuguese tax resident.

The verdict

Belgium tried harder than most countries in this series. The STRIT is a real regime with real benefits, and the 2025 enhancements show genuine political will to compete for international talent.

But low-50s% effective rates on 65% of your income, for a maximum of 8 years, with a 150km geographic restriction — versus 20% flat on Portuguese income plus 0% on qualifying foreign income for 10 years — tells its own story.

Portugal wins Edition 7. Clearly.

The running table

# · Country · Take-home on €500K · Regime · Duration · Notes

1 · PORTUGAL · ~€400K+ · IFICI · 10 yrs · 0% on qualifying foreign income

2 · SWITZERLAND (Zug) · ~€375K-€390K · Ordinary cantonal rates · No expat regime · Wealth tax applies

3 · NETHERLANDS · ~€330K · 30 Ruling · 5 yrs · €233K salary base cap

4 · FRANCE · ~€300K-€330K · Impatriate Regime · 8 yrs · 50% exemption cap, employer-tied

5 · BELGIUM · ~€300K-€320K · STRIT · 5+3 yrs max · Min €70K salary, 150km rule

6 · SWEDEN · ~€285K-€305K · Expertskatt · 7 yrs · SEK 88,800/mo eligibility floor

7 · UK · ~€275K · FIG regime · 4 yrs foreign income only · 45% on UK source from day 1

8 · GERMANY · ~€262K · Standard progressive PIT · No expat regime · 47.5% top rate

Next match: Portugal vs Denmark 🇩🇰 — Denmark has the highest income tax rate in Europe. Spoiler: it's not pretty.

Is IFICI right for you?

IFICI eligibility depends on your professional profile, residency history, income structure, and qualifying activity. The regime is powerful — but it requires proper setup to access the full benefit, and the rules around foreign income exemptions are nuanced and fact-specific.

At Expatico, we help founders and senior hires assess whether they qualify, structure their move to Portugal correctly, and access the full range of Portuguese incentives — from IFICI applications and company incorporation to talent sourcing and grant access.

👉 Register on expatico.eu to find out if you qualify and connect with our team.

📖 Read more editions of The European Tax League at expatico.eu/blog

*All figures are illustrative based on standard assumptions for qualifying employment income. Tax outcomes depend on individual circumstances, commune of residence, income structure, social security treatment, applicable treaties, and anti-abuse rules. This is not tax advice — consult a qualified advisor before making relocation decisions.*