June 13, 2022
16:01
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The court of Bruges gives the green light for an important agreement between the tax authorities and Ghelamco Group. As a result, the real estate developer only has to pay about 10 million euros in tax from an original claim of 153 million euros.
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The essence
- The BBI is at odds with Ghelamco Group and founder Paul Gheysens in various cases.
- In one case, Ghelamco settled with the tax authorities, as a result of which the group ‘only’ has to pay about 10 million euros in tax and default interest. The court has now approved this.
- It cannot be ruled out that agreements will also follow in other matters.
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The court of first instance of West Flanders ruled on one of the tax disputes between Ghelamco Group and the Special Tax Inspectorate (BBI) of Ghent on Monday. Everything revolves around a dividend of 430 million euros that Ghelamco received at the end of 2016 from its Cypriot subsidiary Granbero Holdings. This is a pivotal holding company that oversees some 75 subsidiaries, together accounting for 64 percent of Ghelamco’s real estate portfolio.
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The tax inspectorate had originally fired a tax claim of 153 million euros against Ghelamco. According to the tax authorities, the company had incorrectly applied the deduction for ‘definitely taxed income’ to that 430 million euros.
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But De Tijd already announced last week that Ghelamco negotiated the claim out of court with the tax inspector and that an agreement had been reached with the tax authorities. On the basis of that agreement, only 9.2 million would remain of the original claim of 153 million euros, plus default interests.
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‘Smaller’ amounts
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The expectation was that the court in Bruges would give its blessing for the agreement on Monday and that is what happened, De Tijd learned. The verdict states that the tax authorities have indeed agreed with Ghelamco to a tax exemption of more than 143.36 million euros. In this case, little is left of the gigantic claim of the tax inspectorate.
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The tax authorities conclude that nearly 416 million euros in dividend that ended up with Ghelamco Group nevertheless met the conditions to benefit from the deduction for definitively taxed income and that Ghelamco was allowed to apply it for the assessment year 2017. Only for ‘smaller’ amounts, such as nearly 19 million euros in carry-forward losses and 2.88 million euros in deduction for venture capital, the tax authorities are claiming additional taxes because Ghelamco had insufficiently proven them.
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No one at Ghelamco wanted to comment on the verdict on Monday.
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Negotiations continue
In another case of the BBI, the Bruges court had already rendered a decision on 17 January. That case concerns Elzenwalle, a company that bears the same name as the castle in Ypres that Ghelamco founder Paul Gheysens owns. In the judgment, the court ruled that 33 million euros had wrongly been booked at Elzenwalle as a capital gain on shares that is exempt from tax.
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Ghelamco and Elzenwalle, a company with the same name as the castle of Paul Gheysens in Ypres, have other tax disputes pending.
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According to the court, this concerned an ‘abnormal and benign advantage’ on which the company should have paid taxes at the normal rate. The court ruled in favor of the BBI in that case with its claim of more than 11.2 million euros, including a 10 percent tax increase. In the same judgment, the tax inspectorate was also right about a smaller matter concerning Gheysens’ castle Elzenwalle in Ypres.
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The lawyers of Elzenwalle have appealed against the verdict and on September 5 next year the Ghent Court of Appeal will hear the case again.
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The other tax disputes that Ghelamco and Elzenwalle still have at the court in Bruges will also only be dealt with in September and October next year. It cannot be ruled out that in the meantime negotiations will continue with the tax authorities and even more agreements will be reached.
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