The ‘2026 Tax Cliff’ – Why Belgian Tech Founders may want a US exit… and a US address

The ‘2026 Tax Cliff’ – Why Belgian Tech Founders may want a US exit… and a US address

For years, the “American Dream” for a Belgian tech founder has been a major acquisition by a US strategic buyer or private equity firm. The logic is undeniable: access to the world’s largest single market, validation on a global scale, and, typically, significantly higher valuations than what one might find in a fragmented European market. We’ve seen this play out time and again, as Belgian innovation gets snapped up by US giants looking for top-tier tech and engineering talent. However, a major regulatory shift, set to take effect on January 1, 2026, is about to add a powerful, time-sensitive accelerator to this trend.

This change is moving the conversation from “if” a founder should plan an exit to “where” they should be living when it happens. For many, the answer may be to move themselves and their corporate structure to the US before a sale—and the clock is ticking.

The Clock is Ticking – Belgium’s New Capital Gains Tax

Historically, Belgium has been incredibly favorable for entrepreneurs selling their companies. Capital gains realized by an individual on shares, as part of the “normal management of one’s private assets,” have largely been tax-free. This has been a cornerstone of the Belgian venture and startup ecosystem. That all changes on January 1, 2026.

A new, complex capital gains tax on financial assets will be introduced for Belgian individual taxpayers. While the general rate for most assets (like publicly traded stocks or crypto) is set at 10%, the rules for founders selling their “significant shareholdings” are highly specific.

As we understand it, here’s the breakdown for founders (holding at least 20% of a company):

  • The Exemption – There is a tax-free exemption on the first €1,000,000 of capital gains (this is a lifetime amount, indexed over five years).
  • The Progressive Tax – Gains above this €1M threshold will be taxed at progressive rates, starting at 1.25% and rising to 10% for gains over €10 million.

While a 10% tax might still sound favorable compared to other EU nations, the most critical part of this new law isn’t the rate itself. It’s the “snapshot” and the “exit tax.”

  • The “Snapshot” (December 31, 2025) – The tax is not retroactive. The value of your shares will be “snapshotted” on December 31, 2025. Only the future growth in value (the gain accrued after this date) will be subject to the new tax.
  • The “Belgian Exit Tax” – This is the game-changer. The law includes a provision that treats a transfer of one’s tax residence outside of Belgium as a “deemed sale.” This means if a founder moves after January 1, 2026, Belgium will, in principle, demand they pay capital gains tax on all the unrealized gains in their company shares at the moment they leave.

This single provision creates a powerful “push” factor. It effectively builds a financial wall around the country, incentivizing successful founders to make a choice: stay and face the new tax upon exit, or leave before the law takes effect to avoid this deemed sale.

The ‘American Pre-Exit’ – A Strategic Relocation

If the Belgian exit tax is the “push,” the US tax code provides a massive “pull”, but only if the move is structured with extreme care. For founders who successfully relocate and become US taxpayers, the ultimate prize is the Qualified Small Business Stock (QSBS) exemption. In simple terms, this rule states that a taxpayer who holds QSBS in a US C-Corporation for more than five years can potentially exclude 100% of the capital gains from their federal income tax upon sale. This exclusion is capped at the greater of $10 million or 10 times the taxpayer’s cost basis in the stock. For a founder who built a company from scratch (with a near-zero basis), this means a potential $10 million federal tax-free exit. This creates a clear, albeit complex, strategic path that may require relocating to the US, restructuring, and keeping to the 5-year holding period. This strategy is a complex international corporate and personal maneuver that is fraught with some risk. A standard “Delaware Flip,” where a founder simply exchanges their Belgian shares for new US shares, generally does not qualify for QSBS. The IRS rules require the shares to be acquired at “original issuance” for cash, property (but not stock), or services. Getting this wrong could invalidate the entire strategy. Also, becoming a US taxpayer is a significant undertaking, involving visas (like an E-2, O-1, or EB-5), and a life-changing decision, not just a tax-planning step.

For Belgian tech founders, the “American Dream” is no longer just a business goal; it’s a complex, time-sensitive strategic question. The new Belgian tax law has set a hard deadline. The window to act—to analyze this strategy, model the financial implications, and consult with expert legal and tax teams in both Belgium and the US—is between now and the end of 2025. After that, the options become far more limited and expensive.

Disclaimer: This article is for informational purposes only and does not constitute legal or tax advice. International tax law, especially concerning IRC Section 1202 and Belgian tax reform, is extremely complex. Founders and investors should consult with qualified legal and tax professionals in all relevant jurisdictions before making any decisions.

References & Further Reading