Notification duty in case of cash payments exceeding EUR 5,000
Shortly EUR 3,000
- Griet Verfaillie
- Commercial Law , Finance and Banking
- cash payment , money laundering , Financial Intelligence Processing Unit
The government Di Rupo deemed it necessary to lower the limit of EUR 15,000 to EUR 5,000 in
order to suppress to fiscal and social fraud as well as the money laundering. As of 1 January 2014,
this upper limit will be further reduced to EUR 3,000. As a result, the Belgian limits will be in
accordance with the existing cash thresholds of our neighboring countries. For instance, in Italy
it is been impossible for quite a while to pay more than EUR 1,000 in cash, while in France a cash
threshold of EUR 3,000 exists.
Following the act of 29 March 2012, these limitations of cash payments do also apply to the rendering of services.(1)
Moreover, as from 1 January 2014, concerning the purchase of real estate it will be impossible to make any cash payment. Until the end of this year, cash payments are allowed in real estate transactions if it does not surpass 10% of the purchase price of the good or service, taking a maximum of EUR 5,000 into consideration.
It is important to note that the purchase price of the good or service counts as the limit.
Hence, it is of no use to divide transactions in one or more advance payments or split invoices.
Finally, we wish to point out that a notification duty will be put into place for traders and service providers in sectors sensitive to fraud. In other words, traders and service providers will be expected to notify the Belgian Financial Intelligence Processing Unit when any misuse is detected. Furthermore, they will even have to notify any attempt their clients would have done to make a non authorized cash payment. This notification duty will be implemented by a Royal Decree for traders and service providers in certain specific sectors. Sellers of second hand cars, antiques and art will probably be subjected to these measures.
If after an inspection of the Economical service, it would appear that a trader or service provider has not complied with the aforementioned legislation, he would risk a fine between EUR 250 and EUR 225,000 with a maximum of 10% of the cash payment received illegitimately. The creditor and debtor will individually be liable for the fine.
(1) These limitations do not apply to purchases between natural persons and to deposits on bank accounts. This is governed by other provisions of the act of 11 January 1993, such as costumer survey procedures.