Let us start with the point that wastes the most founder time : the BSPCE is a French instrument. It does not exist under Belgian law, and no company established in Belgium can grant one. The articles, template agreements and simulators found online therefore describe a mechanism that does not apply here. Belgium has its own instruments, with a radically different tax logic – and that difference completely changes how you build a package for a Head of Sales.
In short
- The BSPCE is French : in Belgium, the functional equivalent is a stock option or warrant plan governed by the Act of 26 March 1999.
- The decisive Belgian specificity : taxation applies at grant, not at sale. The beneficiary pays tax before earning anything.
- The taxable benefit is set at a flat 18 % of the value of the underlying shares, reduced to 9 % where the plan meets four cumulative conditions.
- Those conditions impose a lock-up : no exercise before the end of the third calendar year following the offer, and no transfer inter vivos.
- A poorly explained plan achieves the opposite of what was intended : the candidate sees an immediate tax charge where the employer believes it is offering a gift.
Why the French vocabulary does not work in Belgium
The French founder warrant was designed by the French legislator for young companies, with taxation deferred to the moment the securities are sold. The beneficiary pays nothing until they have cashed in. That is what makes the instrument popular in the French ecosystem.
Belgium made the opposite choice. A Belgian founder who copies a French incentive plan exposes their people to an unpleasant surprise and exposes themselves to reclassification. The confusion is common in Franco-Belgian companies and in those whose investors are French : the term circulates in funding discussions without anyone checking what it covers locally.
The instruments actually available in Belgium
| Instrument | Principle | Point of attention |
|---|---|---|
| Stock options | Right to buy existing shares at a price fixed in advance | Taxed at grant under the Act of 26 March 1999 |
| Warrants | Right to subscribe to new shares issued by the company | Same tax regime ; dilution of existing shareholders |
| Shares granted directly | Securities handed over to the employee | Treated as remuneration : contributions and tax on the value |
| Cash-based incentive plan | Bonus indexed on valuation, without securities | Simple to set up, but treated fiscally as salary |
In the practice of Belgian technology companies, the first two lines dominate. The choice between an option and a warrant is mainly a matter of company law and shareholding structure ; from the beneficiary’s point of view, the tax treatment is comparable. The warrant is favoured by young companies because it does not require an existing shareholder to give up securities ; it does create dilution, which has to be anticipated in the shareholders’ agreement.
The Belgian tax regime, explained simply
The Act of 26 March 1999 on the Belgian action plan for employment sets the principle : granting an option constitutes a taxable benefit at the moment it is awarded, not when it is exercised or sold. Where the option is not listed, the benefit is set at a flat percentage of the value of the underlying shares at the time of the offer.
That percentage is 18 %, increased by 1 % per year beyond the fifth if the option is granted for a period longer than five years. It is halved – to 9 % – where four conditions are met : the exercise price is determined with certainty at the time of the offer ; the option cannot be exercised before the end of the third calendar year following that of the offer, nor after the tenth ; it cannot be transferred inter vivos ; and the employer does not cover the risk of a fall in the value of the shares.
The consequence for the candidate is direct and often unanticipated : they pay tax on a theoretical value several years before knowing whether their option will be worth anything. If the company is never sold, or is sold below the exercise price, the tax remains due. An experienced Head of Sales knows this mechanism and will raise it ; a founder who discovers it during the negotiation loses credibility.
The expert’s view
Our principle of transparency is one of our core values : saying what needs to be said, even when it’s uncomfortable. In practice, that means we’ll tell you if your salary range is misaligned with the market. We’ll tell you if the candidate you’re set on raises a red flag on a critical point. We’ll tell you if the training you’re asking for won’t solve the problem you’re describing. Everyone says they value transparency ; few accept its relational cost. We do.
How much to grant? The wrong question
There is no reliable public statistic on the size of grants to commercial leaders in unlisted Belgian companies. The figures that circulate come from the American ecosystem and transpose poorly, not least because taxation at grant changes the equation. Rather than looking for a benchmark percentage, three questions let you build a defensible proposal.
- How big is the total incentive pool, and who else has to fit inside it? Granting generously to the first leadership hire without an overall plan creates mechanical unfairness with the next ones.
- What is the realistic exit scenario, and on what horizon? Capital participation only makes sense if a liquidity event is plausible within a timeframe compatible with the candidate’s career.
- What is the instrument worth, net of tax, in the median scenario? That is the only calculation a senior candidate cares about. Presenting it yourself, including the immediate tax cost, beats letting them discover it.
The valuation used for the offer deserves particular attention. For unlisted companies, the Act provides that the value of the shares be determined on the concurring opinion of the statutory auditor or a company auditor. This is not a formality : that value is the basis for calculating the taxable benefit.
Vesting, cliff and departure : write down the unpleasant scenarios
An incentive plan is judged on how it handles difficult situations, not on how it handles success. Four points must appear in black and white in the documentation given to the candidate.
- Progressive vesting. Over what period, with what initial cliff, and on what basis – seniority alone or seniority plus objectives?
- Voluntary departure. What happens to the vested portion, and on what timetable? The statutory lock-up until the third calendar year complicates early exits.
- Dismissal. The treatment must distinguish between grounds, otherwise the plan becomes a dispute stacked on top of the termination of the employment contract.
- Exit of the company. Payment ranking, preference clauses, treatment of instruments not yet exercisable at the time of the transaction.
These clauses belong to the company’s legal and tax advisers, and we do not encroach on that ground. Our role at the recruitment stage is to check that the candidate understands precisely what is being offered. A misunderstood incentive has no retention value : it produces neither commitment, nor patience, nor acceptance of a lower fixed salary.
How to present the plan to a candidate
Presentation matters almost as much as content. An experienced commercial leader has often already lived through an incentive plan that came to nothing ; they approach the subject with scepticism, and an enthusiastic pitch without figures reinforces it. What works : a one-page document, handed over before the final interview, setting out the valuation used, the number of instruments proposed, the vesting schedule, the estimated tax cost at grant and the return under two or three exit scenarios.
That transparency has a useful side effect : it filters. A candidate who recoils at a modest median scenario would not have lasted three years. A candidate who instead questions the growth assumptions and proposes their own scenarios shows exactly the reflex expected of a commercial leader. The equity discussion then becomes an assessment exercise in its own right.
One practical point : allow time. Written acceptance within the statutory period following the offer conditions the tax regime at grant. A candidate who receives their documentation the day before signing has no time to consult their own adviser, and will either postpone the decision or accept it without understanding it – which amounts to having offered nothing.
What the candidate will ask, and should
A well-prepared commercial leader arrives with a short list of questions, and the quality of the answers tells them more about the company than the size of the grant. What is the current cap table, in broad terms, and how much dilution is expected in the next round? Is there a liquidation preference, and does it stack? Has anyone in the company ever exercised and been paid? What happens to the plan if the company is acquired for less than the last valuation?
Founders sometimes treat these questions as intrusive. They are not : they are the same diligence the candidate will apply to a client contract, which is precisely the behaviour you are hiring for. A founder who answers them plainly, including the unflattering parts, establishes the working relationship on the right footing. One who deflects teaches the candidate that difficult subjects get avoided in this company – a lesson they will remember when the first bad quarter arrives.
There is also a practical asymmetry worth naming. The founder is comparing this candidate with other candidates ; the candidate is comparing this company with a job they already have and understand. Equity is the part of the offer where that asymmetry bites hardest, because its value is the hardest to verify from the outside.
The three most common mistakes
Presenting equity as a salary supplement. A candidate who accepts a fixed salary 15 % lower against a promise of capital is placing a bet, and they know it. Presenting it otherwise damages the relationship at the first difficult quarter. Good practice is to offer a competitive package excluding equity, and to treat capital as what it is : a long-term alignment of interests.
Deciding alone, without the investors. In a funded company, the size of the pool and the allocation rules are usually set out in the shareholders’ agreement. Promising a candidate a level that then has to be renegotiated at board level is the surest way to lose the next two months of discussion.
Neglecting short-term variable pay. Capital participation does not replace a bonus plan. A commercial leader needs a readable annual horizon as well as an exit horizon. The mechanisms available, including the collective bonus framed by collective bargaining agreement no. 90, are detailed in our article on variable pay for commercial roles.
When capital participation is not the right answer
Not every company is meant to open its capital, and many experienced commercial leaders do not make it a condition. In a family business, a group subsidiary or a company whose sale horizon is distant, a multi-year bonus plan indexed on value-creation indicators serves a comparable purpose, with greater readability.
The decision criterion is simple : are you offering a share of an event that has a reasonable probability of happening? If the answer is no, a cash mechanism will be both more motivating and more honest. We would rather say so at the brief stage than watch an offer that looks attractive on paper run into the clear-sightedness of a senior candidate.
These trade-offs are prepared before the search, alongside the scorecard and the split of roles with the founder. We set out that sequence in our article on the right time to hire your first Head of Sales, and we look at what the incumbent will have to deliver in their first priorities on taking over.
A final word of caution : the tax rules applying to remuneration instruments change regularly in Belgium. The principles set out here describe the framework arising from the 1999 Act as it applies today ; any plan should be validated by the company’s tax adviser before being presented to a candidate.
