Judgment;Summary — ECLI:EU:C:2019:894
Date: 2019-10-24
Language of the case: French
Court formation: Eighth Chamber
Subject matter: Free movement of workers
Procedure: Reference for a preliminary ruling
Origin: Belgium

Anonymised version 
Translation C-35/19 — 1 
Case C-35/19 
Request for a preliminary ruling 
Date lodged:  
21 January 2019 
Referring court:  
Tribunal de première instance de Liège (Belgium) 
Date of the decision to refer: 
7 January 2019 
Applicant:  
BU 
Defendant:  
État belge 
  
Tribunal de première instance de Liège 
(Court of First Instance, Liège, Belgium) 
Division Liège (Liège Division) 
Judgment 
Civil Matters 
21st Chamber 
[Or. 2] 
In the proceedings: 
[BU] 
EN 
REQUEST FOR A PRELIMINARY RULING OF 7. 1. 2019 — CASE C-35/19 
 
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[...] ALLEUR[...] 
Applicant, [...] 
against: 
ÉTAT BELGE (the Belgian State) 
[...] LIEGE[...] 
Defendant, [...]. 
I. PROCEDURE 
Having regard to the law of 15 June 1935 on the use of languages in judicial 
matters, 
Having regard to the documents relating to the proceedings, properly conducted, 
and, in particular: 
– The Administrative Decision of 14 June 2017; 
– The application initiating proceedings dated 14 September 2017; 
– The order for preparation for a judicial hearing of 13 November 2017; 
– The submissions of the applicant dated 27 August 2018; 
– The submissions of the defendant dated 29 October 2018; 
– The parties’ case-files. 
The parties as stated above having been heard at the hearing held on 3 December 
2018, at which the oral procedure was closed. 
II. FACTS AND SUBJECT MATTER OF THE CASE  
By application lodged at the Registry on 14 September 2017, [BU] contested her 
personal income tax assessment for the 2014 tax year, as registered under 
Article 765.522.309 of the assessment rolls. She accepts that, under the 
convention for the prevention of double taxation concluded between Belgium and 
the Netherlands, it is Belgium that has the power to levy taxes on the allowances 
which she receives under the WAO (Wet op de 
arbeidsongeschiktheidsverzekering [Law on insurance against incapacity for 
work]). However, she takes the view that those allowances are not subject to tax 
as they have to be regarded as disability allowances and must be exempted in 
accordance with Article 38 § 1(4) of the Code des impôts sur les revenus 1992 
ÉTAT BELGE 
 
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(the 1992 Belgian Income Tax Code; ‘the C.I.R./92’) In the alternative, she seeks 
application of Article 39 of the C.I.R./92 [Or. 3]  
[BU] has lived in Belgium since 1973. She is an American citizen and has had 
Belgian nationality since 2009. 
She worked for the symphony orchestra of Limburg in the Netherlands. 
In 1996 she suffered an accident on the way to work. That accident led to 
incapacity for work. She was dismissed from work in 2000. 
She receives, in the Netherlands, WAO allowances (allowances for incapacity for 
work) paid by the UWV (Uitkeringsinstituut Werknemersverzekeringen; the 
Netherlands employee insurance fund) and an allowance from the ABP 
(Algemeen Burgerlijk Pensioenfond), which is a disability pension fund. 
According to the letter from the UWV sent to her on 24 February 2006 by the 
expert responsible for assessing her fitness for employment in connection with her 
application for the WAO benefit, ‘After assessment, I am of the view that you are 
unable to perform your work. By projecting your situation onto the open labour 
market where an ordinary post is sought, and taking into account the 
classification determined by the insurance doctor, it is possible to calculate your 
theoretical loss of wages. This is expressed as a percentage. On the basis of that 
examination, I consider that you should be capable of performing the following 
general roles (see annex). For such roles, it must be assumed that you would be 
able to earn, on average, EUR 6.37 per hour. That is an amount 67.90% lower 
than the salary of your original profession of violinist. This means that your 
theoretical measure of incapacity for work falls within the class of 65/80% 
incapacity for work for the WAO ...’ (cf. D.A. II/7). 
According to the outcome of the medical officer’s inquiry, submitted by the 
applicant: ‘Disability assessment: It is already established that the client has a 
workplace disability ... 
Prognosis for resuming work: the client is considered to be capable of doing 
suitable work’ (see applicant’s file). 
The applicant works on a half-time basis at the University of Liège, which has led 
to the class of incapacity initially set being lowered. 
By registered letter of 23 August 2016, the authorities sent her a revised 
assessment of her personal income tax return for the tax year 2014. They take the 
view that the allowances paid by the Netherlands should be taxable in Belgium as 
a pension (cf. D.A. IV/6). 
By letter of 28 October 2016 sent by her legal adviser, the applicant agreed to 
having those allowances taxed in Belgium. However, she states: ‘According to 
your analysis, the income is taxable as a pension. If we receive information 
REQUEST FOR A PRELIMINARY RULING OF 7. 1. 2019 — CASE C-35/19 
 
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allowing us to challenge this classification, we will contact you directly or we will 
lodge a complaint. As a result, as regards that classification, the present 
agreement is given without prejudice and subject to the receipt of more extensive 
information.’ (cf. D.A. IV/4-5). 
The tax was determined on this basis under Article 765.522.309 rectifying 
Article 743.448.803 of the rolls. The notice of assessment was sent on 
23 November 2016. [Or. 4]  
[BU] lodged a complaint against that assessment on 16 December 2016 (cf. 
D.A. III). 
By decision of 14 June 2017, the complaint was rejected on the ground that the 
applicant had not established that those amounts were disability allowances rather 
than allowances for incapacity to work. 
According to the authorities, the WAO allowances are subject to tax on the basis 
of Article 34 of the C.I.R./92. Moreover, the applicant has not provided proof 
either of her disability or of the fact that these are disability allowances. 
III. ADMISSIBILITY 
The application was lodged in the form and within the period provided for by law 
after the correct preliminary administrative review had been carried out. It is, 
therefore, admissible. 
IV. DISCUSSION 
1. Article 34 of the C.I.R./92 
Article 34 of the C.I.R./92 states: 
§ 1 Irrespective of the party liable, the beneficiary, the classification 
or the detailed rules for the determining and granting thereof, 
pensions, annuities and equivalent allowances shall comprise: 
1 ° pensions and annuities which are for life or temporary, as well as 
equivalent allowances, which are directly or indirectly linked to a 
professional activity; 
1 °bis. pensions and annuities which are for life or temporary, as 
well as equivalent allowances, which constitute compensation in full or 
in part, for a permanent loss of benefits, remuneration or profits. 
An allowance granted under an insurance contract is subject to tax if it 
compensates, fully or in part, an actual and permanent loss of remuneration (see. 
Cass., 19 April 2012, www.juridat.be). 
ÉTAT BELGE 
 
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However, allowances paid under an insurance contract covering a physiological 
and/or economic disability, that do not relate to the remuneration received by the 
insured person or to his professional activity but which are intended to 
compensate, irrespective of any professional activity, a psychological and/or 
economic disability and its potential impact, whatever the actual impact on the 
professional activity and the remuneration, profits or benefits of the assured 
person, are not taxable (see T. Afschrift and M. Daube, L'impôt des personnes 
physiques, Chronique de jurisprudence 2000-2008, Larcier, 2009, No 374; Civ. 
Namur, 11 January 2002, RG 1251/99, www.fiscalnet.be). [Or. 5]  
2. Article 38 of the C.I.R./92 
Article 38 of the C.I.R./92 provides: 
§ 1 The following are exempt: 
4°  Allowances, paid by the State Treasury, granted to persons with 
disabilities, in accordance with the relevant legislation; 
Article 6(1) of the Netherlands Law of 31 May 1956 ‘inzake een algemene 
ouderdomsverzekering (on general old-age insurance) (AOW)’ provides that 
persons who have not yet reached the age of 65, whether or not resident in the 
Netherlands, and who are subject to income tax on account of a professional 
activity carried out in the Netherlands, are insured in accordance with the 
provisions of that law. If the recipient of an AOW allowance pursued a 
professional activity in the Netherlands and contributed to the financing of the 
AOW by means of a premium withheld from remuneration or charged on, inter 
alia, the basis of employment income, there is, for the part of the AOW allowance 
relating to that period of employment, a link with the professional activity of the 
recipient within the meaning of Article 34 § 1(1) of the C.I.R./92 (see Cass., 
5 May 2017, F.15.0119.N, www.juridat.be). 
3. In the present case: 
In the present case, it is clear from the documents submitted by [BU] that the 
allowance paid constitutes a disability allowance intended to compensate for loss 
of income linked to a disability. 
The allowance is set by reference to the salary that the person concerned earned 
before the accident, compared with the salary that he/she is able to earn taking 
account of his/her current abilities; the incapacity may change (cf. D.A. II/10). 
It is also clear from the ‘Etude comparative des politiques du handicap dans 
plusieurs pays européens’ (Comparative study of disability policies in several 
European countries) submitted by the applicant that the mechanism put in place 
by the Netherlands is intended to encourage persons with a disability to work as 
far as their remaining capacity allows them by receiving an allowance intended to 
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compensate for the loss of income due to the total or partial reduction of their 
capacity to work. 
Accordingly, it is clear that the sums paid to the applicant by the WAO do not 
amount to a pension. It appears that they indeed relate to a disability allowance. 
The Belgian State claims that only disability allowances paid by the State 
Treasury — in other words, allowances paid by the Belgian State — may be 
exempted. The applicant, however, did not make an application in Belgium for a 
disability allowance. 
However, as the applicant notes, she had no reason to make an application for a 
disability allowance in Belgium since she received such an allowance in the 
Netherlands, the country where she worked and where she had social-security 
cover at the time of the accident. [Or. 6] 
The fact that the Belgian State might not have granted a disability pension in such 
circumstances does not change this. 
As regards whether or not the WAO allowances received by the applicant are tax- 
exempt: 
Article 38 § 1(4) of the C.I.R./92 refers specifically to: ‘allowances, paid by the 
State Treasury, granted to persons with disabilities, in accordance with the 
relevant legislation’. 
Therefore, the allowances received by the applicant, although they amount to 
disability benefits which would be exempt if they were paid by a Belgian body, 
cannot be exempted as a result of this provision. 
The applicant takes the view that, in those circumstances, the Belgian system 
discriminates between taxpayers who receive Belgian disability allowances, which 
are exempt, and taxpayers who receive identical allowances from another Member 
State of the European Union, which are not exempt. 
She submits that, should the allowance paid by the Netherlands not be exempt, 
there would, in the present case, be an infringement of the principles of equal 
treatment and non-discrimination as well as of the fundamental freedoms 
guaranteed by the Treaty on [the Functioning of the] European Union (free 
movement of persons and services). 
Such a situation seems, indeed, capable of hindering the free movement of 
residents of EU countries, in the light of the significant difference in treatment of 
the allowances that they receive depending on whether they are paid by the 
Belgian State or by another State of the European Union. 
ÉTAT BELGE 
 
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The applicant requests that this matter be referred to the Cour Constitutionnelle 
(Constitutional Court, Belgium) and to the Court of Justice of the European 
Union. 
As a first step, it is necessary to ask the Court of Justice of the European Union 
whether that provision is consistent with the principles of free movement of 
workers and of freedom to provide services (Article 45 et seq. and Article 56 et 
seq. of the Treaty on the Functioning of the European Union). 
ON THOSE GROUNDS 
The Tribunal de première instance de Liège, after hearing the parties’ 
arguments, 
Having regard to the law of 15 June 1935 on the use of languages in judicial 
matters, 
Dismissing as unfounded all other submissions. 
Declares the application admissible. [Or. 7] 
Declares that it is not at present possible to rule on the application  
Rules that is necessary, before giving final judgment, to refer the following 
question to the European Court of Justice for a preliminary ruling: 
Does Article 38 § 1(4) of the C.I.R./92 infringe Article 45 et seq. (principle 
of free movement of workers) and Article 56 et seq. (principle of freedom to 
provide services) of the Treaty on the Functioning of the European Union in 
so far as it exempts disability allowances from tax only if those allowances 
are paid by the State Treasury, that is to say, by the Belgian State, in 
accordance with Belgian legislation, thereby giving rise to discrimination 
between taxpayers resident in Belgium who receive disability allowances 
paid by the Belgian State under Belgian legislation, which are exempt from 
tax, and taxpayers resident in Belgium who receive allowances intended to 
compensate for a disability paid by another Member State of the European 
Union, which are not exempt from tax? 
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