A new law, which took effect on 1 July 2016, provides for a favourable tax regime for income generated by (small) services rendered by private individuals to other private individuals, outside their professional activities, through a state-certified or -owned online platform.

Provided all conditions are met and as long as such income does not exceed EUR 5,000 gross per year, it will be considered as diverse income and not as professional income. Such diverse income will be subject to a 20% tax rate, that will be levied on 50% of the gross income only.

The requirements to benefit from this favourable tax regime are quite strict.  

If these conditions are met, the individuals rendering the services do not have to register as self-employed and, hence, are not required to pay the related social security contributions.

As long as the EUR 5,000 cap is not exceeded, it is also possible to combine such favourably taxed income with the income generated by a regular professional activity (as employee or self-employed), provided the activities generating each type of income are clearly distinct.

The target population seems to be students or employees/self-employed who want to develop a new (side-) activity. One question is whether this regime could also be used by the unemployed to start a new activity without losing allowances.

The aim of the government is to boost entrepreneurship and to prevent the income generated by such small peer-to-peer services from remaining in the subterranean economy. Time will tell how efficient it will be.