Unpaid company representatives and mandatory social insurance: clarity at last

In principle, company representatives are subject to the mandatory social insurance system of self-employed persons.

Until recently, the legislation contained two non-refutable presumptions to determine whether or not company representatives had to comply with the mandatory social insurance system. Since 2008, the National Office for Social Insurance of self-employed persons (RSVZ / INASTI) however allowed in practice to refute these presumptions.

The non-refutable nature of the presumptions was also condemned by the Belgian Constitutional Court as well as the European Court of Justice.

The Belgian legislator rectified the situation (see the Act of 25 April 2014 holding various provisions relating to social security and the Royal Decree of 27 May 2014 modifying the Royal Decree of 19 December 1967 holding the general rules in execution of the Royal Decree number 38).

Two refutable presumptions

Since 1 July 2014, the two non-refutable presumptions are replaced by two refutable presumptions.

The first presumption states that persons who are appointed as representative of an (incorporated or factual) association or company whose activities are of a lucrative nature, or persons who, without being appointed, exercise a mandate in such an association or company, are refutably considered as exercising an independent professional activity.

The second presumption states that an independent professional activity as representative in an association or company that is subject to Belgian corporate tax or Belgian tax for non-resident entities, is refutably considered as taking place in Belgium.

How to refute the presumption?

If you are a representative or director of a company, you can avoid the duty to have a social insurance by proving the unpaid nature of your mandate. In doing so, it is of no importance whether you are managing the company from Belgium or from aboard.

There are two ways to do so:
a. The company’s articles of association mention that the mandate is unpaid; or
b. The competent body within the company or association decides that the mandate is unpaid. If this body decides, at a later stage, to grant you a remuneration, you will obviously be obliged to register with the mandatory social insurance system.

Besides, the unpaid nature of the mandate should also appear from the execution of the mandate. In practice, this means that if you receive (tax) remunerations for your mandate, or if the association or company for which you work pays contributions for the building up of a complementary pension, the mandate will not be considered as unpaid.

If you challenge your obligation to join the mandatory social insurance system, you can go back for a period of maximum 12 months.