Registration duty in the Walloon Region: suspended tax reductions

This tax reduction has been suspended on 1 January 2025.

In the Walloon Region, you are entitled, under certain conditions, to a tax-free allowance for the purchase in full ownership of a house that will serve as your main residence. The tax-free allowance is part of the tax base on which you do not have to pay registration duty.

The tax-free allowance amounts to 40,000 euros. You will then pay no registration duty on a bracket up to 40,000 euros of your purchase. That means a tax advantage of up to 5,000 euros for an immovable property subject to the normal registration duty of 12.5 per cent (40,000 x 12.5 per cent).

If the reduced registration duty of 6 per cent (modest home) or 5 per cent (social mortgage loan) applies to you, the tax advantage may be less, depending on the tax base.

The tax-free allowance is also applicable to purchases of:

• off-plan houses or houses under construction
• building lots

The amount of the tax-free allowance depends on the purchase value of the immovable property.

House

Off-plan house or house under construction or building lot

Conditions for the tax-free allowance

• The immovable property must be located in the Walloon region.
• You must be a natural person. This means that companies, associations or other legal entities are not eligible.
• The immovable property must be used or intended for residential purposes (i.e. a house or flat, including houses purchased off-plan or under construction, and building lots).
• You must purchase the immovable property in its entirety in full ownership (this may be done by several people together). Therefore, purchases of a part, the usufruct or the bare ownership of the property are excluded.
• On the date of the acquisition agreement, you may not be the full owner, in its entirety, of another immovable property intended, in whole or in part, for residential use. In case of acquisition by several persons together, this condition applies to each of them separately.
• You must establish your main residence in that immovable property (i.e. be registered there in the population register or the register of foreign nationals):
  • within three years if it is an existing house
  • within five years if it is a building lot, or an off-plan house or flat, or a house or flat under construction
• You must maintain your main residence in the immovable property for a continuous period of at least three years from the time you established your main residence in that immovable property.

Formalities

There are some form requirements in order to qualify for the tax-free allowance. Your adviser can assist you in this regard (e.g. your civil-law notary).

You must apply for the tax-free allowance in the instrument (or in a signed document attached to the instrument) and state that:

• you are not already the owner of a house which results in the exclusion of the tax-free allowance
• you undertake to establish your main residence in the property purchased:
  • within three years if it is an existing house
  • within five years if it is a building lot, an off-plan house or flat, or a house or flat under construction
• you undertake to maintain your main residence in the purchased immovable property for a continuous period of three years from the date you established your main residence in that immovable property.

This tax reduction has been suspended on 1 January 2025.

If you purchase a modest house in the Walloon Region, under certain conditions you enjoy a reduced registration duty of 6 per cent on part of the purchase price.

If for the purchase you have a credit with certain credit institutions with social purpose, the duty is reduced to 5 per cent and the registration of the mortgage deed in the form of 'Eco-Prêts' (Eco Loans) is exempted from the 1 per cent duty.

Part of the purchase price

The reduced registration duty of 6 or 5 per cent is limited to a certain amount according to whether the modest house is located in or outside an area with real estate pressure. This amount is indexed annually.

On the part of the purchase exceeding the maximum amount, you will pay the normal registration duty (in principle 12.5 per cent).

These are the municipalities that are listed in an area with real estate pressure for the period from 01.01.2022 to 31.12.2022 (updated on 1 January 2022): Arlon, Attert, Aubel, Beauvechain, Braine-l'Alleud, Braine-le-Château, Chastre, Chaumont-Gistoux, Court-Saint-Etienne, Genappe, Grez-Doiceau, Incourt, Ittre, Jalhay, Jodoigne, La Bruyère, La Hulpe, Lasne, Messancy, Mont-Saint-Guibert, Neupré, Nivelles, Ottignies-Louvain-la-Neuve, Perwez, Rixensart, Silly, Verlaine, Villers-la-Ville, Walhain, Waterloo, Wavre.

Conditions

• It must involve the purchase of full ownership or bare ownership of a property.
• The non-indexed cadastral income of the purchased property may not exceed a certain amount, depending on the number of dependent children:

  Dependent children	Maximum cadastral income
  0 to 2	745.00 euros
  3 or 4	845.00 euros
  5 or 6	945.00 euros
  7 and more	1,045.00 euros

• The total cadastral income of the property acquired and of the property already owned in full or bare ownership by you or your spouse or legal cohabitant at that time, may not exceed the aforementioned maximum amounts. For the calculation of the total cadastral income, immovable property owned only in bare ownership by you or your spouse or legal cohabitant and acquired from the estate of the respective ascendants, is not taken into account.
• You or your spouse or legal cohabitant may not own an undivided part, even minimal, in another immovable property intended for residential purposes.
• In certain cases, immovable property that cannot be occupied due to legal or contractual obstacles is not taken into account. It must be an actual obstacle attributable to the building itself (for example: a decree of uninhabitability issued by the mayor).
• Immovable property you sell within the year following the deed of acquisition - insofar as you have the intention to sell mentioned in the instrument - or in the year in which the immovable property is occupied for the first time - if it is built on land eligible for the reduced registration duty - is also not taken into account.
• You or your spouse or legal cohabitant must register in the population register or in the register of foreign nationals at the address of the property purchased. This registration must be done within a period of three years from the date of the authentic sale contract and must be maintained without interruption for at least three years.

Formalities

There are some form requirements in order to qualify for the reduced registration duty. Your adviser can assist you in this regard (e.g. your civil-law notary).

In the instrument or in a statement certified true and signed at the bottom of the instrument, you must:

• include the legal notices
• state that the conditions to enjoy the reduced registration duty have been met (maximum cadastral income and immovable property)
• state that the obligations to maintain the reduced registration duty will be fulfilled.

This tax reduction has been suspended on 1 January 2025.

When you buy a building lot that will serve as the construction site of a modest house, you benefit, under certain conditions, from the reduced registration duty of 6 or 5 per cent.

The conditions and formalities are the same as those for the purchase of a modest house.

Please note that the reduced registration duty will not be applied immediately. The sale contract of the building lot is registered at the standard registration duty (12.5 per cent). The amount paid in excess of the reduced registration duty will be refunded if, subsequently,

• the cadastral income of the house built does not exceed a certain ceiling (in principle, 745 euros)
• the other conditions for immovable property have been met.

In order to receive the refund, you will need to submit a cadastral extract. You can submit an application once the cadastral income of the house is determined.