A 23 April 2019 binding Tax consultation has clarified what retention rate must be applied to remunerations paid by a company to its director or board members when such company is part of a holding group.

Salaries and payments received as a director or board member are subject to a general 35% retention made by the company and on account of the director’s personal income tax. However, when such salaries and payments come from a company with previous year earnings’ below €100,000, the retention rate will be 19%.

In conclusion, in order to determine the applicable retention rate the accounts to consider will be that of the company in which the director or board member carries out his role and not the holding company nor any other related company.