Your bank accounts will be just a little less private

  • The Treasury was already able to investigate within the banks.
  • There was, however, no file compiling Belgians’ accounts.
  • This gap is now closed: This “contact point” will be up and running as of May 2014.

Friday, the Moniteur published a text that the tax specialists and taxpayer have been awaiting for two years. This is the implementation decree for the April 2011 law. This text creates a “central contact point” within the National Bank of Belgium (BNB) that will gather all Belgian bank customers’ information. This will include bank account numbers and contracts (installment loans, home loans), and entails a massive amount of data: 40 million accounts and about one hundred million contracts going back to 2010.

The April 2011 law eased banking confidentiality. It allows the “fisc,” the Belgian tax authority, to investigate within financial institutions if there is enough evidence of fraud such as a disproportionate lifestyle, discovery of an undeclared foreign account, etc. At that point, the fisc can first ask the taxpayer for an explanation. If it’s not satisfactory, it can turn to the National Bank to find out how many bank accounts the taxpayer possesses and in which establishments. That’s the theory anyway.

In practice, however, the National Bank has not been able to create this “contact point”, due to the lack of an implementation decree that would gather Belgian banking customer accounts. This certainly won’t keep the fisc from investigating. Any officer harboring suspicions regarding a taxpayer will, however, have to send a letter to every bank in the country in order to find out if “Mr. X” was indeed one of their customers. It’s time consuming, expensive and complicated.

This contact point will thus make the fisc’s job a lot easier by making available all accounts and contracts held by a particular taxpayer and in which bank. This file, however, will not be directly accessible. “A balance must be established between confidentiality and information requests by the administration”, states Febelfin, the association representing the banks. This is the reason it will be placed in the BNB.

This information can be requested in only two cases. The first case is if fraud is suspected. The second is to find out a taxpayer’s financial status for the state to recover taxes due. Even with that, a strict procedure must be followed. The taxpayer first must be notified. Then, only if the taxpayer refuses to give the requested information will the officer be able to contact his regional manager in order to receive authorization to use the BNB file. Foreign tax authorities can verify a file for accounts that non-residents might have in Belgium. It would be easier for them to access this file than for the Belgian fisc because it only requires a request from a foreign tax authority that presents sufficient evidence of fraud to obtain the key to open the contact point.

“This file should be operational as of May 2014,” specifies Davine Dujardin, representative for Koen Geens, the minister of finance. The banks need several months to prepare. A first delivery including data from 2010, 2011 and 2012 will made in February next year. The rest (2013 data) will be sent on March 31. After that the file will be updated at the end of every March.

The tax experts have awaited this text for several months. Some were surprised that it would go all the way back to 2010. “This retroactivity is a bit shocking at first,” observes Sabrina Scarna of the Tetra Law firm. “Of course, the fisc can demand information regarding previous years, but in this case we’re dealing with an execution decree of an April 2011 law that requires that the banks provide account data from 2010. In reality, this changes the law’s effective date,” she adds.

PIERRE-HENRI THOMAS

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