Small business VAT exemption (franchise): invoicing in Belgium

Under the small business exemption, usually called the VAT franchise (articles 56bis to 56undecies of the VAT Code), a Belgian business with annual turnover in Belgium of at most €25,000 excluding VAT charges no VAT, files no periodic VAT returns and cannot deduct VAT on its purchases. It keeps its VAT number and still issues invoices, with a prescribed mention in place of the VAT. Since 1 January 2026 it must also send structured e-invoices to Belgian VAT-registered business customers and be able to receive them.

This guide is for freelancers, people with a secondary self-employed activity, very small companies and associations, and their accountants. Other regimes are compared in VAT regimes on Belgian invoices, all general invoice mentions are in Belgian invoice legal mentions, and receiving supplier invoices is covered in franchise and VAT-exempt businesses on Peppol.

Who can use the exemption in 2026

Small business exemption (franchise)

A special VAT scheme that depends on the business's own turnover and activity. The business is a taxable person with a VAT number, but it charges no VAT on its sales in Belgium and cannot deduct VAT on its costs. The customer's status plays no role.

Since the Law of 10 February 2026, the VAT Code states explicitly that franchise businesses cannot deduct VAT on the goods and services they use for their franchise transactions (art. 56bis §4).

Thresholds from 2027

The Law of 23 September 2026 (Belgian Official Journal, 7 October 2026) raises the threshold each year from 1 January 2027. The 10% tolerance explained under ‘When and how you leave the scheme’ applies on top of each year's threshold.

What a franchise invoice must show

The law. Since 1 January 2025, Royal Decree no. 1 (art. 5 §1 10°quater) requires the mention ‘Régime particulier de la franchise de taxe’ in French or ‘Bijzondere vrijstellingsregeling van belasting’ in Dutch, ‘in place of the tax’. No VAT is charged. The wording used until 31 December 2024, ‘Régime particulier de franchise des petites entreprises’, is outdated. We have not found an official German wording: ask your accountant if you invoice in German.

All other mentions of a full invoice remain required: date and sequential number; your name, registered office address and VAT number; the customer's name, address and VAT number if it has one; the supply date if it differs; what you supplied; the unit price excluding VAT, the taxable amount and any discounts. Companies and associations add their company-law mentions, such as legal form and enterprise number.

A franchise business may also issue a simplified invoice with fewer mentions (art. 13 RD no. 1); within the scope of the B2B obligation it must still be sent as a structured Peppol invoice (FPS FAQ). If your registered office is in the Dutch-language area, the legally required parts must be in Dutch.

What OrdoGrid prints. The option name and the printed text follow Profil entreprise → Langue des documents (company profile → document language):

Lines are set to 0% and the PDF shows a VAT total of €0.00. In the Peppol XML, OrdoGrid sends the lines and the VAT breakdown under category E (exempt from VAT) at 0%, with the printed text in your document language as the exemption reason that rule BR-E-10 requires (no VATEX code), and embeds the PDF. The same text opens the document note (BT-22), followed by your Notes.

Franchise is not a 0% rate, an article 44 exemption or reverse charge

Your customer's status never determines whether the franchise applies: a business outside the scheme charges VAT to private customers too, and a franchise business charges none to companies either. OrdoGrid never suggests the franchise, because it depends on your own status: you choose it yourself. For a Belgian customer with a VAT number, the compliance dialog can offer Régime cocontractant, which does not belong on a franchise invoice.

Peppol since 1 January 2026: send and receive

The law. FPS Finance's FAQ (Q2): ‘The obligation applies if you make use of the exemption scheme for small businesses.’ A Belgian-established franchise business must issue structured e-invoices to Belgian VAT-registered businesses and be able to receive structured e-invoices from its suppliers. For these invoices the structured invoice is the legal invoice; a PDF copy is optional.

The tolerance period ended on 31 March 2026. A business that lacks the technical means to send or receive can be fined €1,500 for a first infringement, €3,000 for a second and €5,000 for each further one (Royal Decree no. 44). Receiving is explained in franchise and VAT-exempt businesses on Peppol.

Set up OrdoGrid once

1. In Profil entreprise, enter your VAT number (BE followed by your enterprise number) in Numéro de TVA (Optionnel) (VAT number, optional). Without it, you cannot send on Peppol.
2. Choose Langue des documents: it sets the language of the PDF and of the printed franchise text.
3. Open Peppol. On Autorisation Peppol, fill in Nom complet du signataire (signatory's full name), tick the confirmation box and click Signer et confirmer l'autorisation. This is a typed confirmation, not a qualified electronic signature.
4. On Réception Peppol, click Activer la réception (activate receiving) to be registered as 0208: followed by your enterprise number, or Continuer en envoi seul (continue send-only) if another provider already receives your Peppol invoices.

Each step is detailed in set up Peppol in OrdoGrid.

Issue a franchise invoice in OrdoGrid

1. Open Invoices (page Factures), click Nouvelle facture (new invoice) and pick the customer with Sélectionner un client.
2. Click Ajouter un article (add item) and fill in Description, Quantité (quantity) and Prix Unitaire (unit price). Add all lines first.
3. In the Récapitulatif (summary) sidebar, open Options de TVA and set Traitement TVA (VAT treatment) to Régime de la franchise de taxe (the field and option names follow your document language: with Dutch documents BTW-behandeling → Kleine ondernemingsregeling, English VAT treatment → Small business exemption, German MwSt.-Behandlung → Kleinunternehmerregelung). Every existing line goes to 0%.
4. Check that each line's TVA shows 0% and the totals show TVA €0.00. A new line copies the rate of the line above; a first line added after choosing the option starts at 21%.
5. You do not need to add the franchise wording to the Notes: on French and Dutch documents, OrdoGrid prints the official text itself.
6. Click Aperçu du PDF (PDF preview) and check the mention and both VAT numbers.
7. Click Envoyer (send). Keep Envoi électronique via Peppol ticked for a Belgian VAT-registered customer found on Peppol. Email is pre-ticked when the customer has an address: untick it unless the customer wants a PDF copy. Click Sauvegarder & Envoyer (save and send).
8. Follow delivery under Peppol → Outbox. Traité (processed) means delivered on the network, not accepted or paid.

The number is fixed at the first save, including as a draft (default format F-{YYYY}-{####}); keeping the series unbroken is your responsibility. Once an invoice is sent on Peppol or a payment is recorded, its amounts are locked: correct it with a credit note started from the invoice, which copies the franchise option, and with it the printed franchise wording, and replaces the Notes with ‘Note de crédit pour la facture …’ (correct or credit an invoice).

Worked example: an €800 design invoice, before and after the scheme

Camille Dubois is a freelance graphic designer in Namur, VAT number BE 1012.345.646, under the franchise, with documents in French. Before this invoice, her 2026 turnover in Belgium is €19,400. She designs a beer label for Brasserie du Confluent SRL in Namur, VAT number BE 0456.789.034, which is on Peppol.

After F-2026-0017 her turnover is €20,200: €4,800 below the threshold and €7,300 below the €27,500 limit. By 31 December 2026 it reaches €26,300, 5.2% above €25,000. She keeps the franchise for all of 2026 but is under the normal regime from 1 January 2027, even though the 2027 threshold is €26,000: what counts is that she exceeded the 2026 threshold. She can return on 1 January 2028 at the earliest, if the conditions are met.

Variant: had she reached €26,900 on 20 November 2026, a €1,200 job would take her to €28,100, above €27,500. The franchise ends with that transaction: €1,200.00 + €252.00 VAT = €1,452.00, and VAT on every later 2026 invoice. Agree the exact cut-off with your accountant.

When and how you leave the scheme

FPS Finance's rule: a whole calendar year under the normal regime must pass before you can use the franchise again, and only if the conditions are met.

From the switch date:

1. Declare the change with an e604 declaration, or ask your accountant to do it.
2. In OrdoGrid, set Traitement TVA to Standard (with Dutch documents BTW-behandeling → Standaard, English VAT treatment → Standard, German MwSt.-Behandlung → Standard) and give each line its rate (21% by default).
3. On invoices you reuse with Dupliquer (duplicate), switch the franchise option to Standard, and remove any franchise wording you typed in the Notes.
4. Keep the same VAT number, invoice series and Peppol set-up.
5. With your accountant, start filing periodic VAT returns and work out how to treat the VAT you paid on purchases, stock and equipment.

Yearly obligations that remain

• Annual client listing and turnover: by 31 March, file the annual client listing in Intervat for the previous year; in it you also report your total turnover in Belgium, or ‘0,00’ (nihil listing) if you had no transactions (VAT Code art. 56quinquies §2; FPS Finance). The 2026 listing is due by 31 March 2027.
• Intra-Community declaration: required by FPS Finance when you supply goods or services to businesses in other EU countries.
• e604 declarations: to start, change or stop your activity.
• Invoice books: not required if you file your invoices in an unbroken number series and keep the register of art. 14 §5, in which you enter the invoices and documents for transactions on which you yourself owe the VAT, such as services bought from abroad (RD no. 1, art. 14 §4–§5).
• Special VAT return: when you owe the Belgian VAT yourself, for example on services bought from a business in another EU country (software subscriptions, online advertising) or on intra-Community acquisitions, file a special VAT return and pay that VAT; you cannot deduct it (FPS Finance).
• No periodic VAT returns while the franchise applies (special returns excepted).

A preliminary draft law approved by the Council of Ministers on 18 July 2026 would introduce e-reporting and abolish the annual client listing for those subject to it; as of October 2026 it is not law. OrdoGrid files no listings or returns: filter Factures by date, or select rows and click Download (tooltip: Download as ZIP), to give your accountant the year's invoices.

Customers abroad and the EU SME scheme

• Business customer in another EU country. Services are generally taxable in the customer's country (VAT Code art. 21 §2), where the customer accounts for the VAT, and the invoice needs its VAT number. The Belgian franchise mention may then not be the right one: ask your accountant which regime and mention apply. OrdoGrid offers Autoliquidation when the customer's VAT country differs from yours. See invoice customers abroad.
• Franchise in another EU country (since 1 January 2025). Your annual EU turnover must stay at or below €100,000, and that country's own threshold and conditions apply. You notify the Belgian administration beforehand, listing the countries and your turnover per country; for this scheme your VAT number gets the suffix ‘EX’. You report turnover within one month after each quarter, and within 15 working days if you exceed €100,000, which ends the scheme (VAT Code art. 56quater to 56decies). OrdoGrid has no EX setting, so agree with your accountant how to show that number.

Mistakes to avoid

Evidence to keep

• The e604 declaration or confirmation of the franchise start and any change.
• Your yearly turnover calculation and proof of the 31 March communication.
• Every invoice and credit note: the PDF and, for Peppol, the XML (Peppol → Outbox, download XML, or select rows for a ZIP with XML and PDF).
• Purchase invoices and the art. 14 §5 register of transactions on which you owe the VAT yourself.

Keep invoices for 7 years from 1 January of the year after issue (VAT Code art. 60, as amended by the Law of 18 December 2025). OrdoGrid archives the exact XML it sent on Peppol but is not a legal archiving service: keep your own copies.

FAQ

Do I have to send Peppol invoices if I use the small business exemption?

Yes, to Belgian businesses with a Belgian VAT number: FPS Finance says the obligation applies to the exemption scheme for small businesses. You must also be able to receive structured invoices. Invoices to private individuals and customers abroad are outside the obligation.

What exact sentence must appear on my invoice?

‘Régime particulier de la franchise de taxe’ in French or ‘Bijzondere vrijstellingsregeling van belasting’ in Dutch, in place of the VAT. OrdoGrid prints this wording on French and Dutch documents; English and German documents carry a translation.

Can I use the exemption because my customers are private individuals?

No. The franchise depends on your own turnover, activity and notification, not on your customers.

Can I deduct the VAT on my laptop or software?

No, not while you use the franchise. Deduction becomes possible under the normal rules once you leave the scheme.

What happens if I go over €25,000 this year?

Up to €27,500 you keep the franchise until 31 December and switch on 1 January. Above €27,500 the normal regime applies from the transaction that takes you over that limit. After a 2026 overrun, you can return on 1 January 2028 at the earliest.

Do I still file anything with the VAT administration?

No periodic returns, but each year by 31 March you report your previous year's turnover in Belgium through the client listing in Intervat, even when it is zero. Intra-EU supplies and changes to your activity have their own declarations. If you owe VAT on services bought from another EU country or on intra-Community acquisitions, you also file a special VAT return and pay that VAT.

Is the franchise the same as a 0% VAT rate?

No. A 0% rate covers a few specific goods and article 44 exempts certain services. The franchise covers your business's supplies in Belgium as a whole, except the transactions excluded by art. 56bis §3; it has its own mention and is never combined with reverse-charge wording on the same invoice.