Income tax - How are deferred income taxed?

Verified 06 June 2024 - Directorate for Legal and Administrative Information (Prime Minister)

Deferred income is income received one year for an activity carried out a previous year. They are taxed according to a particular system, the quotient system. It avoids excessive taxation. Here are the rules for deferred revenue collected in 2023 and 2024.

Collected in 2023

Deferred revenue is revenue you received in 2023, but that is the remuneration for activities you performed in 2022 or earlier (over one or more years).

The offset must not not be of your making.

For example: salary or promotion recall, pension recall, rent arrears.

These revenues have been subject to withholding tax like other income.

If you report your deferred income with other income, you may significantly increase your taxes.

You can ask that such income be taxed in accordance with quotient system which limits that risk

The quotient system tax scale avoids the progressivity of

The calculation depends on the number of calendar years corresponding to the normal payment deadlines.

This number is then increased by 1.

Example :

In 2023, you received arrears rents for six monthly installments in 2020 (November, December) and 2021 (January, February, March, April).

The deadlines correspond to 2 calendar years (2020 and 2021).

The coefficient to be used is 3 (2+1).

The quotient system applies in 2 stages:

  1. Add one-third of the exceptional income to the usual income (the quotient thus determined is added to the total taxable net income)
  2. Multiply by 3 (the quotient thus determined) the corresponding tax supplement.

Please note

Deferred income tax is paid in one go.

To benefit from the quotient system, you do not report your deferred income with your business income on your 2024 income tax return for 2023.

So, for example, you should not report a wage recall with your other wages and salaries, or a rent arrears with your property income.

You must declare them as deferred income.

You must enter the total of these revenues within the planned framework on page 3 of declaration No 2042 C (line 0XX).

You must detail the amount and nature of income deferred to be imposed on the quotient, received by each member of the household by one of the following means:

  • Within the framework of the declaration
  • On free paper attached to Declaration No 2042.

For each amount, you must specify the year of its normal maturity.

The 2024 income tax return for 2023 is complete.

The 2025 2024 Income Tax Return will begin in april 2025.

Tax returns via Internet is required if your principal residence is equipped with internet access and you are able to file your return online.

Collected in 2024

Deferred revenue is revenue you received in 2024, but that is the remuneration for activities you performed in 2023 or earlier (over one or more years).

The offset must not not be of your making.

For example: salary or promotion recall, pension recall, rent arrears.

These revenues have been subject to withholding tax like other income.

If you report your deferred income with other income, you may significantly increase your taxes.

You can ask that such income be taxed in accordance with quotient system which limits that risk

The quotient system tax scale avoids the progressivity of

The calculation depends on the number of calendar years corresponding to the normal payment deadlines.

This number is then increased by 1.

Example :

In 2024, you received arrears rents for six monthly installments in 2021 (November, December) and 2022 (January, February, March, April).

The deadlines correspond to 2 calendar years (2021 and 2022).

The coefficient to be used is 3 (2+1).

The quotient system applies in 2 stages:

  1. Add one-third of the exceptional income to the usual income (the quotient thus determined is added to the total taxable net income)
  2. Multiply by 3 (the quotient thus determined) the corresponding tax supplement.

Deferred income tax is paid in one go.

You will need to report deferred income received in 2024 in your 2025 income statement 2024 (spring 2025), regardless of the amount.

To benefit from the quotient system, you will not have to report your deferred income with your business income.

You will therefore not, for example, have to declare a wage recall with your other salaries and wages, or a rent arrears with your property income.

You have to report them as deferred income.

You must enter the total of these revenues within the planned framework of Declaration No 2042 C.

You will detail the amount and nature of income deferred to be imposed on the quotient, received by each member of the household by one of the following means:

  • Within the framework of the declaration
  • On free paper attached to Declaration No 2042

For each amount, you will have to specify the year of its normal maturity.

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