For the loans of which the contract has been signed before the 1^st June 1984, an exemption is foreseen by the law. If the loan is below 1.500.000 Bef, the totality of the loan is tax exempt.
If this limit is exceeded, the part of the loan above the limit will be taxed as an advantage.

As described by the law, the loans repaid in once at the end of the loan duration are considered as non regular in reference to the normal periodic repayment. In such a situation, two cases have to be considered.

• The repayment is granted only by the repayment of the capital and the advantage is calculated at the end of every calendar month. In the loan condition (customising), the fields concerning the repayment periods have to be maintained with the value '1' (for the monthly payroll calculation).

• The repayment is granted by the repayment of the capital and a periodic interest. In the loan condition, the period for the interest payment is entered as usual.

In customising (in both case), although the field concerning the period for the capital repayment is compulsory on the screen, it is of no importance and it won't be used.

On then screen of the IT 0045, from the field group 'Condition', only the loan condition number will appear.

A record 'special repayment' (IT 0078 - subtype 250/200) should be immediately created for the repayment of the total at the end of the contract. The date of repayment should correspond to the end date of the record on the IT0045.

A loan to allow the purchase of a car.

Amount: 100.000 Bef. - paid the 01.01.1998.

Interest: 3% monthly - 12 months.

Repayment: 100.000 once on 31.12.1998

Monthly load rate: 0,3

Annual load rate: 6,65 (formula)

IT45: B150 - 01.01.1998 till 30.11.1998

IT78: 0150 - 100.000 Bef - 01.01.1998

0250 - 100.000 Bef - 31.12.1998

As described by the law, the date from which the reference rate will be read correspond to the date of the written offer of the employer to the employee. The reference date is taken two months previous this offer date.

Every time the contractual interest rate is reconsidered, the reference rate will be the one corresponding two months before the date determined for the interest adaptation.

Consequently, in order to have this modification available for the payroll calculation, the record of the IT0045 should be delimited every time the interest is adapted.

The new delimited record will contain the date determined for the interest adaptation in the field 'approval date'.

The interest can be adapted following two different options;

• Delimitation of the record in the loan condition customising with the consequence of modifying these conditions for all concerned employee's in the master data.

• Using another loan condition number in customising (already existing or a new one).

Mortgage loan - Annuity.

Amount: 220.000 Bef. - paid the 01.01.1997.

Interest: 2,8% monthly - 1^st year

1% monthly - 2^nd year.

Reference: 3,16% - 1^st year

4,07% - 2^nd year.

Repayment: 10.000 Bef monthly - start 01.02.1997

IT45: B230 - 01.01.1997 till 31.12.1997 - approval date 01.01.1997 - 220.000 Bef

B230 - 01.01.1998 till 31.12.1998 - approval date 01.01.1998 -220.000 Bef

IT78: 0150 - 220.000 Bef - 01.01.1997

The yearly load rate (jaarlijks lastenpercentage/taux de charge annuel) is calculated according to the formula given by the law. In this formula, the duration of the loan (total calendar repayment duration) is required.

During the payroll calculation, this period will be calculated as the difference between the end and the beginning of the validity period of the IT 45 record. Consequently, the end date and begin date of the record should be entered with accuracy.

A loan to allow the purchase of furniture.

Amount: 100.000 Bef. - paid the 01.01.1998.

Repayment: sart 01.02.1998 - monthly - 10.000 Bef. - 11 months.

Interest: 3% - monthly.

Monthly load rate: 0,35 (01.11.1997).

Yearly load rate: 7,64 (formula)

IT45: B150 - 01.01.1998 till 30.11.1998

IT78: 0150 - 100.000 Bef - 01.01.1998

If the back payment of the loan is granted only by the repayment of the capital (loan with no interest). The taxable advantage will be evaluated in the same time with the repayment of capital. That is to say, the customising of the loan conditions must contain the same periods for the interest repayment and for the capital repayment.