The new tax context forces a rethink of transactions in company sales. As 2026 begins, the Belgian landscape for company sales is undergoing a profound transformation. The introduction of the capital gains tax on shares is redefining exit strategies.

A technical aspect has now become crucial: the fate of excess liquidity (excess cash). What is meant by excess cash? It refers to liquid assets that exceed strict operational requirements. In a traditional valuation, net debt/cash is added to the company's operational value (Enterprise Value) to arrive at the value of the shares (Equity Value). This amount is calculated by adding cash and short-term investments, deducting financial debt.

Case-law tightening

Until the end of 2025, a shareholder wishing to extract this liquidity faced a trade-off: distribute dividends (subject to a 30% withholding tax) or sell their shares by including the cash in the price (and realize a capital gain that was, in principle, exempt). An exception was made for "internal capital gains", where a certain level of tolerance was generally accepted.

Over time, however, the tax authorities tightened their position, and case law followed suit. To achieve its goals, the administration relies on two legal weapons:

  • Abnormal management of private assets (Art. 90 CIR92): this allows internal share transfers to be reclassified as taxable miscellaneous income at a rate of 33%. A sale to one's own company, without a serious economic or family motive, does not qualify as normal and prudent management of private assets.

  • Tax abuse (Art. 344, §1 CIR92): this aims to prove that the structuring had no other purpose than to evade the withholding tax. If successful, the transaction was reclassified as a dividend distribution taxed at 30%.

"Purging excess cash" to secure the transaction

To put an end to this legal uncertainty, the legislature struck hard. Capital gains realized on share sales to a company controlled—directly or indirectly—by the seller or their family are now automatically taxed at a rate of 33%. The goal is to neutralize mechanisms that convert dividends into capital gains without having to demonstrate abuse on a case-by-case basis. Contributions remain, for the time being, outside this automatic scope.

This new tax landscape requires a complete rethink of transactions. Even in sales to third parties, including a significant amount of cash becomes a risk zone: tax authorities may view it as tax abuse and suspect an agreement aimed at transforming a taxable dividend into an exempt sale price. Sales contracts therefore generally mandate a purge of excess cash before closing (cash-free/debt-free). On its side, the buyer will typically seek protection against any tax risk linked to the transaction or negotiate a price discount to offset the latent tax liability on the purchased cash.

The seller therefore has every interest in distributing this liquidity as a dividend (taxed at 30%): it is now a safer and often less costly route than the 33% tax rate.

In certain cases, this tax pressure can even be reduced:

  • Capital reduction allows the repayment of paid-up capital tax-free (subject to pro-rata rules);

  • Liquidation reserves allow, under specific conditions and with adequate preparation, the tax burden to be reduced to around 15%.

One difficulty remains: determining the actual amount of excess cash. Between the working capital requirements (WCR) essential to operations and future investments (CAPEX), the line is thin.

While the new law clarifies the treatment of internal capital gains, it adds complexity to price structuring. More than ever, liquidity management requires sharp technical expertise and rigorous caution.

Footnotes (Article Notes)

  1. Law of April 6, 2026, applicable retroactively from January 1, 2026.

  2. The EBITDA multiple method is frequently used to value a company.

  3. The "internal capital gain" scheme consisted of selling one's company to a holding company controlled by the seller and then financing the price via dividends from the operating company in order to convert taxable income into lightly taxed or non-taxed capital gains.

  4. A ruling by the Court of Cassation on January 11, 2024, recognized the existence of tax abuse, even in a sale to a third party, where a "chronological intent" aimed at rapidly extracting liquidity post-sale was present. However, a ruling on January 22, 2026, reiterated that tax authorities cannot "alter factual reality" nor ignore an intermediary company without proof of simulation, especially if funds remain blocked at that level.

  5. The subject of this article, as well as the legal and case-law references, are based on a presentation delivered by CMS De Backer for the FB Transmission team.

  6. Furthermore, the 30% dividend tax is final (libératoire), whereas the 33% tax (Art. 90) often comes with local municipal surcharges.

Article by Tanguy della Faille – Managing Partner at FB Transmission.

Published in La Libre Éco (LLE) on Saturday, May 19, 2026.