Typically, the Belgian tax authorities begin the new year by greeting Belgian and multinational companies with a wave of information requests, and 2025 was no exception. Over 300 information requests were sent, and additional requests will follow throughout the year.
The Belgian tax authorities are growing their capacity to perform transfer pricing audits and are increasing their emphasis on Belgian TP compliance requirements in TP documentation. This takes the form of expanded and expansive information requests, significant process analysis, and the possibility of group audits.
Companies need to be aware of this evolving confidence on the part of the tax authorities to not only review their local file and master file, but to go far beyond typical TP questions into a more detailed analysis of the company activities. This relates to the increased adherence to Belgian TP report compliance to process analysis. Auditors want to gain insight into who is doing what for whom and why. Companies are being pushed to go beyond simple answers and prove elements claimed in the documentation.
This places greater emphasis on breaking down the activities in the functional analysis in a detailed list and with specific descriptions of the activities and responsibilities of the parties involved. Blanket “canned” responses are not acceptable for most activity. (Keep in mind that general business descriptions for centers such as payroll will still have traditional descriptions, but this is the exception rather than the rule; we all know what the payroll department does but it only gets attention when something goes sideways).
For companies with multiple entities within Belgium, there is an increased likelihood of group audits where the various companies/branches are audited simultaneously. As a best practice, the local entities should have a specific person designated as the contact person for the group. This allows the company to have a consistent TP methodology and to provide uniformity to both the TP local file documentation and audit responses.
