What does the reform of registration duties in Flanders involve?

Flemish registration duties are undergoing a number of reforms. These decisions were taken by the Flemish Government during the September Declaration (27 September 2021). Here is what you need to know.

When purchasing your own and sole home

From 1 January 2022, rates will be reduced when purchasing a home. Registration duties are expected to fall from 6% to 3%. Furthermore, for buyers undertaking a comprehensive energy renovation or reconstruction work, the rate is expected to fall from 5% to 1%.

This reduction in rates is not without consequences. Indeed, from 1 January 2024, the reduction is expected to be accompanied by the abolition of the portability of registration duties paid on the previous property purchase. Until 2024, there will be two options regarding registration duties:

• Use the new rates of 3% and 1%, without portability.
• Use the previous rates of 6% and 5%, but with portability.

If you are in the process of buying a property and are able to sign the notarial deed in 2022, do so. This could save you a considerable amount of money. However, do not forget one detail: the notarial deed must be signed within four months of the preliminary sale agreement. This means that if the agreement was signed before 1 September 2021, the deed will have to be signed this year. You will therefore pay the current registration duties and will not benefit from the rate reduction.

Although these reforms to Flemish registration duties may appear advantageous, they only apply to Flanders. Indeed, no reduction in registration duties currently appears to be planned in Wallonia.

When purchasing a second property

As in the previous case, the reforms are expected to apply from 1 January 2022. However, they will be far less advantageous. When purchasing a second property, Flemish buyers will face an increase in registration duties. The rate will rise from 10% to 12%.

If you wish to invest in a second home in Flanders, it is therefore more advantageous to do so before 1 January 2022. If this applies to you, try to sign the notarial deed by 31 December 2021 at the latest, in order to benefit from the current rate, which is lower than the forthcoming rate.

The reform of Flemish registration duties is therefore advantageous in one situation, but not in the other. If you are about to invest in Flanders or are planning to do so, you should therefore determine which option is most advantageous for you.