In this article I outline the most important points to watch, so that you can work across borders with confidence and good preparation.
What do we mean by a foreign subcontractor?
We speak of a foreign subcontractor when a company established outside Belgium carries out work for you, for example in construction, IT, consultancy, transport or logistics.
Joint liability: an important Belgian rule
In Belgium, the client in certain sectors (such as construction or cleaning) can become jointly liable for some of the subcontractor’s debts, such as social security or tax debts.
This means that you, as the client, may be held responsible if your subcontractor does not meet their obligations. That is why advance checks and clear agreements are essential.
LIMOSA declaration and A1 certificate
When personnel from a foreign company temporarily work in Belgium, a LIMOSA declaration is often mandatory.
In addition, a A1 certificate is usually required for posted workers. It confirms which social security system applies. Missing documents can lead to fines and problems during inspections.
Contract and clear arrangements
A clear contract is indispensable. It should at least clarify:
- which work the subcontractor performs
- who communicates with the end client
- who is responsible for permits, notifications and documents
- who is liable in case of errors or damage
- how invoicing, VAT and payment will work
In practice, I like to involve a lawyer for these agreements: international cooperation is perfectly possible, but it requires preparation and knowledge.
VAT and place of supply
For cross-border services, the first question is: where is the service “deemed” to take place? The answer determines whether Belgian VAT, foreign VAT or reverse charge applies.
For works related to immovable property (for example construction), special rules apply. An incorrect application can lead to corrections, interest and penalties.
Staff leasing and B2B cooperation
It is important to know that in Belgium it is not allowed to place staff at the disposal of another company, unless you are recognised as a temporary employment agency.
If a subcontracting agreement in reality functions like “lending personnel”, serious sanctions may follow.
My advice
Working with foreign subcontractors can be efficient and profitable, provided everything is structured correctly from the beginning.
- check registrations and certificates in advance
- make clear written agreements
- clarify VAT responsibilities
- keep all documents available for inspections
This reduces your risk and keeps cooperation transparent for everyone.