In this blog, we discuss the key aspects of VAT when renting out a garage box in Flanders. Whether you're a private individual or a professional in the real estate sector, this blog provides a clear understanding of VAT regulations.
We’ll cover exceptions to the rules, the process for applying for a VAT number, and the requirements for periodic VAT returns.
This information is intended to provide you with clear, concise, and practical guidelines for meeting your tax obligations when renting out a garage box.
Only small businesses with an annual turnover of less than €25,000 can qualify for the small business scheme. Under this scheme, VAT is not applicable.
If you rent out just one garage, your income will likely be under €25,000, allowing you to make use of this scheme. If you have another economic activity, it's best to consult the tax authorities.
This means that as a garage owner renting out a garage box, you must be aware of the associated VAT obligations. It’s not just about additional costs; compliance with tax regulations is crucial for pricing, profitability, and long-term success.
For tenants, the impact is minimal as they simply pay the price inclusive of VAT. However, landlords are responsible for accurately declaring and paying this tax. You must submit periodic VAT returns (monthly or quarterly) and transfer the collected VAT to the state treasury.
It’s also important to note that if you use this exemption scheme, you won’t pay VAT, but you also can’t deduct VAT. For example, you can’t claim VAT on costs related to the maintenance or renovation of the garage box or parking space.
While the small business scheme can be appealing, it’s advisable to consult the tax authorities or your accountant. Exemption from VAT comes with both advantages and disadvantages.
Regardless of your status, renting out a garage requires VAT. As a private individual, you’ll need to apply for a VAT number and declare the monthly income unless you opt for the small business scheme mentioned earlier.
For professional landlords, renting a garage is like any other income subject to VAT.
This VAT number is not just a legal requirement but also enables you to correctly process and report VAT transactions. Be aware that obtaining this number confirms your responsibilities as a VAT-liable landlord.
This responsibility should not be underestimated, as errors can lead to penalties or audits. Besides VAT returns, maintaining detailed records and fulfilling other tax obligations—depending on your situation—is essential for a successful and compliant rental practice.
We handle the short-term rental of garages and parking spaces for visitors and travelers. This lets you earn from your garage hassle-free.
With our platform, your garage box is rented out quickly and efficiently, and we provide the support and tools needed to make your rental experience smooth and enjoyable. Curious about how we can Spark your rental process? Contact us for more information.
We’ll cover exceptions to the rules, the process for applying for a VAT number, and the requirements for periodic VAT returns.
This information is intended to provide you with clear, concise, and practical guidelines for meeting your tax obligations when renting out a garage box.
Disclaimer: The information in this guide is intended as general advice and should not be regarded as legal or tax advice. Laws and regulations may change and vary depending on specific circumstances. For tailored advice and the most up-to-date information, we recommend consulting a qualified accountant or legal advisor.
VAT on garage rentals in brief
If you rent out a garage, you are VAT-liable and must charge 21% VAT to your tenants.Only small businesses with an annual turnover of less than €25,000 can qualify for the small business scheme. Under this scheme, VAT is not applicable.
If you rent out just one garage, your income will likely be under €25,000, allowing you to make use of this scheme. If you have another economic activity, it's best to consult the tax authorities.
Everyone in Flanders is VAT-liable
In Flanders, VAT liability is not taken lightly, especially regarding renting out real estate. While it may seem surprising to some, every garage rental transaction is subject to VAT.This means that as a garage owner renting out a garage box, you must be aware of the associated VAT obligations. It’s not just about additional costs; compliance with tax regulations is crucial for pricing, profitability, and long-term success.
VAT for garage rentals
When renting garages, VAT obligations are straightforward. As a landlord, you are subject to VAT regulations.When renting out a garage box or parking space, you must charge tenants 21% VAT. Additionally, the rental price, including 21% VAT, must be declared.
For tenants, the impact is minimal as they simply pay the price inclusive of VAT. However, landlords are responsible for accurately declaring and paying this tax. You must submit periodic VAT returns (monthly or quarterly) and transfer the collected VAT to the state treasury.
Exceptions to VAT regulations
There is an exception to VAT regulations: if your total income is less than €25,000 annually, you are eligible for the exemption scheme. Note, however, that this includes all registered income—not just rental income—from any other economic activity under the same VAT number.It’s also important to note that if you use this exemption scheme, you won’t pay VAT, but you also can’t deduct VAT. For example, you can’t claim VAT on costs related to the maintenance or renovation of the garage box or parking space.
While the small business scheme can be appealing, it’s advisable to consult the tax authorities or your accountant. Exemption from VAT comes with both advantages and disadvantages.
Renting a garage as a private individual or professional
Regardless of your status, renting out a garage requires VAT. As a private individual, you’ll need to apply for a VAT number and declare the monthly income unless you opt for the small business scheme mentioned earlier.For professional landlords, renting a garage is like any other income subject to VAT.
Applying for a VAT number with the competent authorities
If you want to start renting, a VAT number is a must. You can apply for one by registering with the Belgian Crossroads Bank for Enterprises. There, you will receive a business registration number that allows you to apply for a VAT number with the FPS Finance.This VAT number is not just a legal requirement but also enables you to correctly process and report VAT transactions. Be aware that obtaining this number confirms your responsibilities as a VAT-liable landlord.
Periodic VAT returns and other obligations
Once you have your VAT number, the next step is to submit regular VAT returns. These are typically done quarterly and require meticulous record-keeping of all VAT collected and owed.This responsibility should not be underestimated, as errors can lead to penalties or audits. Besides VAT returns, maintaining detailed records and fulfilling other tax obligations—depending on your situation—is essential for a successful and compliant rental practice.
Renting out your garage on autopilot?
Feeling overwhelmed by the complexities of renting out your garage box? Meet SparkSpot!We handle the short-term rental of garages and parking spaces for visitors and travelers. This lets you earn from your garage hassle-free.
With our platform, your garage box is rented out quickly and efficiently, and we provide the support and tools needed to make your rental experience smooth and enjoyable. Curious about how we can Spark your rental process? Contact us for more information.
