Constitutional Court undermines WHT exemption for work shifts

For the corporate withholding tax (“WHT”) exemption for work shifts to apply, the consecutive shifts must consist of the same scope of work. But does this mean that the scope of work must be identical, or does it qualify as work with peak- and off-peak hours, or must the work be similar, also for the purpose of the exemption? If the term “the same” is presumed to be “identical”, wouldn’t this interpretation mean that there is no distinction in how they are treated? The Constitutional Court answered this in the negative in its recent February 8th judgment. This decision has therefore become a threat, as if it were a Sword of Damocles, to the application of the exemption for many companies.

What’s it about?

Companies that operate using work shifts can benefit from a WHT exemption of up to 22.80% of the workers’ wages (see Art. 275/5 Income Tax Code 1992, WHT Exemption).

This WHT exemption leads to a substantial reduction of wage cost for the employer, but multiple legal conditions must be met, which is also strictly monitored.

One of the conditions is that the consecutive shifts must consist of “the same work in terms of job description and scope.” In practice, there is a lot of controversy surrounding how this condition should be interpreted. Is “similar” work considered “the same” as well? And does this condition have to be assessed per shift or per individual worker?

These questions are important. After all, a strict interpretation of the expression will cause a significant number of companies to no longer be eligible for the WHT exemption. The WHT exemption will therefore continue to be reserved de facto for companies in the industrial sector (with production lines), while those in other sectors or those with peak- and off-peak hour work schemes or in which similar work are carried out in consecutive shifts would be excluded.


Court of Cassation: pre-judicial questions

Last year, the Court of Cassation had to rule on this issue in cassation proceedings against the so-called bus-driver and roadside-service-agent judgments that were rendered by the Antwerp Court of Appeal.

The Court of Appeal held that the scope of the work in shifts is allowed to be similar, and not necessarily the same. But this condition must be assessed at shift-level and not per individual worker.

Each of these judgments was challenged on cassation appeal.

If “the same work” were to be interpreted as “identical” and were to be assessed at the level of the complete shift, this would give rise to the question whether this would lead to a violation of the equality principle. Ultimately, in its judgments of 24 March 2023 and 31 March 2023, the Court of Cassation submitted two questions to the Constitutional Court for preliminary ruling.

Constitutional Court: no violation of the equality principle

In its judgment of 8 February 2024, the Constitutional Court ruled that in this interpretation, the distinction is not unreasonable, so there is no violation of the equality principle.

The legislators have a broad discretion in assessing. And, according to the preparatory legislative works and the context in which the law came about (Ford Genk restructuring), the Constitutional Court finds that the legislators are pursuing legitimate goals. A strict interpretation would also prevent companies from adapting how they organize their work to make themselves eligible for the exemption and to limit the budgetary cost of this measure.

Therefore, the difference in how they are treated is in fact reasonably justified. The legislators wished to merely describe in a “non-selectively sectoral way” the companies that are eligible for the scheme.

How the scope of the work must be assessed will always be a question of fact.



This Constitutional Court ruling hangs over the application of the exemption for many companies, as if it were a Sword of Damocles.

But contrary to what can be read in certain new articles, the Constitutional Court did not rule on the manner in which “the same” work must be interpreted. On the contrary, the Constitutional Court ruled only on a difference in treatment that would exist if “the same work” were to be interpreted as “identical,” that is, if a specific interpretation were to be followed.

The ball therefore lies again with the Court of Cassation, which will have to rule on the interpretation of “the same work”. But this Constitutional Court judgment will clearly have a great impact and will pave way for a strict interpretation.

A strict interpretation will have serious implications in practice. Companies that have a peak- and off-peak hour work scheme, or whose work in consecutive shifts are different, would no longer be eligible for the exemption. And they will be faced with a significant increase in labour cost. Moreover, identical work in consecutive shifts is rare in practice (e.g., because a machine is out of order, because workers are sick, external circumstances, …).

But this does not alter the fact that companies now have a good reason to review and critically assess the application of the exemption to their organization. Furthermore, it remains to be seen how the tax authority will apply the judgment in practice.

You can read a comprehensive analysis of this in the Fiscale Actualiteit (tax news) journal.



Do you have any questions about the application of the exemption, or is your company undergoing inspection? Please contact Luk Cassimon ( or 0472/467.847) or your usual contact person at Monard Law.

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