What’s the situation regarding those investments?
Your company’s surplus cash is sitting in a savings account and hardly earning anything. The value of your money falls if only because the interest rate you receive on your savings is lower than inflation. This is how you lose purchasing power year-on-year. High time, then, to do something about it - by investing!
But are you allowed to do that through your company? You may have heard conflicting reports about that. Some argue that you are not permitted invest through your business, while others argue the opposite. And you don't have the time to do the research and keep up with all the rules yourself.
Meanwhile in your savings account...
All these doubts mean you leave your company's cash lingering in your savings account. A good investment opportunity is bound to fall into your lap one day, right? Meanwhile, the months and years fly by without anything happening. And without you earning anything from your money.
KBC Brussels removes all doubts
Want the definitive answer on whether you can invest through your company and what the tax implications are? We answer these and some other frequently asked questions below.
And if you’d like a bit more explanation on anything, we’re here to help. Just come and see our Business Wealth Management Expert, and feel free to bring your accountant if you wish. Leave your details with us and we will contact you soon.
FAQs
Yes, absolutely! Unless stated otherwise in your company’s articles of incorporation, you may invest through your company. Not quite sure yet? Then enquire directly with our Business Wealth Management Expert.
Yes, you can always stop or cash in your investment at a certain price, and your investment could potentially be worth less than you paid for it. But if the investment opportunity is interesting enough, that sacrifice will be compensated.
Moreover, whilst invested your money has the potential to grow in value, whereas the same money left in a savings account will only reduce in value.
In principle, you may invest as much as you want and are able to through your company. There are however some things to consider. Our Business Wealth Management Expert knows all about it. Leave your details and they will be happy to provide you with a personalised calculation of your investable capital.
That calculation will take the following factors into account:
- Your investment profile and your company's investment horizon;
- Your personal situation as a company manager;
- Tax aspects such as notional interest deduction, corporation tax and the reduced tax rate.
Your company's tax situation will not change, as long as you take into account some tax rules. Provided you invest within the framework of those rules, your company will continue to enjoy the reduced corporation tax rate and notional interest deduction. Read more about the tax implications below.
It depends on your situation. Generally speaking, the proceeds of your investments are taxable under corporation tax. Interest and dividends received as well as realised capital gains all constitute taxable income. Consequently, withholding tax is deducted when interest and dividends are paid out; under certain circumstances, this can be credited as an advance against the corporation tax due.
If your company invests in shares, you will be eligible for a special tax deduction under certain strict conditions. To claim the Dividends Received Deduction, (DRD) you must meet specific conditions. Certain investment companies (known as ‘DBI beveks’) take those conditions into account, so the income your company receives from them may be eligible for all or part of the Dividends Received Deduction.
The above answers address general questions. If you would like specific information for your company, leave your details and a Business Wealth Management Expert will contact you.
But do you have enough time and knowledge to invest?
Decided that investing is the best option for your cash reserves, but not sure what you need to do? It doesn’t to be difficult or time-consuming. You can be involved as much or as little as you want. Read more about our different investment methods here.