If you plan to start working as a self-employed, you first have to go through a number of mandatory steps. These are the top 7 formalities:
1. Open a bank account
You need a current account in order to receive funds. Open a separate account for your professional activities to ensure that your private transactions remain separate. Mention your professional account number together with the name of the bank on all trade documents, such as quotations and invoices.
2. Gather all the necessary supporting documents
You must collect all the necessary documents for the official exercise of your independent activity before your trip to the enterprise counter. For example, you need a ‘basic knowledge of business management’ certificate and in some cases also a license or certificate of professional aptitude.
3. Register with a recognised enterprise counter
Registration with a recognised enterprise counter is another crucial step. They help you register with the Crossroads Bank for Enterprises (CBE/KBO). Once this formality is over, you will get your own 10-digit business number which is also your VAT number. This procedure is also mandatory for practitioners of liberal, intellectual and service professions.
4. Activate your VAT status
As soon as you have a business number, you will be able to apply for a specific VAT regime. This rule also applies to self-employed people in secondary occupation. There are 4 common regimes:
- Exemption for small businesses: your annual turnover is less than 25,000 euros.
- Quarterly VAT returns: your annual turnover is less than 2,500,000 euros.
- Monthly VAT return: your annual turnover is greater than 2,500,000 euros or you belong to a fraud-sensitive sector.
- Lump-sum VAT return: for a number of specific professions.
5. Join a social security fund
A self-employed person (in main or secondary occupation) pays social security contributions to a social insurance fund every quarter. This means that you must join a fund of your choice before starting your independent activities. In practice, this is often the same organisation as the enterprise counter. This allows you to claim certain entitlements such as pension and family benefits.
6. Register with a health insurance fund
Registering entitles you to health insurance cover, just like wage earners, making sure you get the support you need if your health fails. In the event of incapacity for work, you are also entitled to an allowance under certain conditions. If you are already registered, report your status change.
7. Make sure you are properly insured
Having your own business entails new responsibilities and puts you at risk of liability claims. So, make sure you are sufficiently protected and decide which insurance policies you need.
Becoming a self-employed professional – in main or secondary occupation – is a relatively simple process. Once you have fulfilled the 7 main formalities, you can get started. If you can’t be bothered doing everything yourself, trust an accountant to take care of all statutory obligations for you.
Need more info on the necessary formalities to start as a self-employed professional?
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