Incentives and financing of start-up companies

During this episode, Katrien De Schepper, Tax Specialist at VGD, discusses the different ways in which a start-up company can benefit from resources to increase its capital and also all the requirements that are necessary for the correct financing of your company.

Katrien De Schepper

Incentives and financing of start-up companies

How much money do you need to start a company?

On the one hand, the establishment of a company often requires a minimum amount of capital. For example, if you want to set up a BVBA, you will need 18,550 euros, of which 6,200 euros will have to be paid up. In the case of a one-person BVBA this is 12,400 euros, but this does not mean that this minimum capital is sufficient for the activity to start successfully. Often a start-up of a company or an activity involves substantial investments, for example IT investments, purchase of equipment, furniture, renting an office where a deposit has to be deposited. So all these investments make sure that the capital you initially need to set up for your company may not be enough.

So you need a real financial plan?

Indeed! Actually, at the start of the company, you have to draw up a financial plan and start looking at your financing needs and how to get the money. If the client has sufficient equity capital, we can look for an optimal division of that capital into equity capital and debt capital. If the customer does not have sufficient own resources, we will have to look at alternative forms of financing, such as crowdfunding or bank financing.

There are many incentives for business start-ups. The tax shelter is the best known, it is often used, does this deal with a lot of money?

The amounts involved are considerable. A taxpayer can invest up to 100,000 euros per year in a start-up company. He receives a tax advantage of 30% or 45%, depending on the amount he has invested. This is subject to one condition: the amount he invests in the company may never represent more than 30% of the share capital of that company.

And can everyone claim this tax shelter?

In principle, yes. Any starting company can appeal to the tax shelter. However, some companies are excluded, such as a real estate company, which only invests in real estate or, for example, management companies are also excluded.

So there really has to be an activity?


Can parents help their children and, for example, grant a loan to their entrepreneurial son or daughter?

Yes, of course. They can also apply for the win-win loan because you will also receive a tax benefit. You can lend up to 50,000 euros to your son or daughter and in exchange you will receive 2.5% tax reduction on the average outstanding amount. If the case of the son or daughter is not successful anyway, you can actually recover 30% of the outstanding capital in the personal income tax return.

Does the loan always have to be repaid?

Yes, when the win-win loan is concluded, a contract must be drawn up that provides for a refund. The repayment terms can be determined by the company itself. There can be an annual repayment, a repayment at the end of the term, so after eight years, because the win-win loan runs for a period of eight years each. Once the money has to be repaid, the parents can consider giving back the money that their son or daughter has to pay back by means of a bank donation.

Companies are also required to make advance payments in order to avoid tax increases. Are starters who do not make prepayments punished?

No they are not punished. They are provided with an exemption for the first three years where they do not receive an increase for insufficient prepayments.

You give advice to young people. Do young people find their way to professional advice or is there a barrier to reaching you?

We try to keep this threshold as low as possible by personally approaching starters and starting entrepreneurs. Even though we are present at universities and colleges, since those students are also the starters of tomorrow and by approaching them personally we hope that the threshold for them to obtain advice from us will be lower.

Then the ice is already a bit broken.

For sure! I think so!


Do you have any further questions? You can always contact our advisors!