Changes to the size criteria for micro and small associations and foundations

On 25 May 2024, the Royal Decree was published that amends the criteria that determine whether an association or foundation should be considered micro or small. This decree is relevant to any association or foundation, as it directly affects accounting obligations, among other things.

These amendments will enter into force for the financial years commencing after 31 December 2023.

The most important changes at a glance

1. Small NPOs (Article 1:28, § 1 of the Belgian Companies and Associations Code).

• Annual turnover: The threshold has increased from €9,000,000 to €11,250,000.
• Balance sheet total: The threshold has increased from €4,500,000 to €6,000,000.

2. Micro NPOs (Article 1:29, § 1 of the Belgian Companies and Associations Code).

• Annual turnover: The threshold has increased from €700,000 to €900,000.
• Balance sheet total: The threshold has increased from €350,000 to €450,000.

3. Small foundations (Article 1:30, § 1 of the Belgian Companies and Associations Code)

• Annual turnover: The threshold has increased from €9,000,000 to €11,250,000.
• Balance sheet total: The threshold has increased from €4,500,000 to €6,000,000.

4. Micro foundations (Article 1:31, § 1 of the Belgian Companies and Associations Code)

• Annual turnover: The threshold has increased from €700,000 to €900,000.
• Balance sheet total: The threshold has increased from €350,000 to €450,000.

What does this mean for your association or foundation?

The increased thresholds mean that more associations and foundations may now fall within the micro or small categories. This may result in less stringent accounting requirements, simplified administrative burdens and various tax benefits. Below is a non-exhaustive list of the possible benefits:

• No requirement to prepare and publish an annual report
• No obligation to appoint a statutory auditor
• The ability to file abbreviated financial statements
• A reduced rate of corporation tax
• …

Entry into force and temporary exceptions

The decree applies to financial years commencing after 31 December 2023. An important temporary exception will apply for the first financial year commencing after that date: the rules of Articles 1:28, § 2, 1:29, § 2, 1:30, § 2, and 1:31, § 2 on the consequences if one or several of these criteria is exceeded will not apply on this one occasion.

What should you do now?

It is essential for associations and foundations to thoroughly review their current financial situation and evaluate how the recent changes will affect them. It is advisable to consult with your accountant or financial advisor to fully understand the implications and to take full advantage of the simplified rules.

Do you have any questions or need advice?

At Crowe Legal, we are ready to help you navigate these changes. For more information or specific questions about how these changes may affect your association or foundation, please contact one of our specialists.