Aave and Belgian taxes: how your interest income is taxed

Last updated: February 2026 · Reading time: 7 minutes

"You deposited 10,000 USDC into Aave and after a year your account shows 10,500 USDC. Which part is taxable, and at what rate?"

Aave is one of the largest DeFi lending protocols in the world. Belgian users deposit stablecoins and crypto into it every day in exchange for an interest yield. But how the Belgian tax authorities view that income is still a grey area for most people. In this article we explain step by step how aTokens work, how the interest yield is calculated, and how to declare it correctly in your tax return.

🔍 What is Aave and how do aTokens work?

Aave is a decentralized lending protocol on Ethereum, Base and Arbitrum. When you lend out assets via Aave, you receive aTokens in return: representative tokens that track your position in the liquidity pool.

What makes aTokens special is that they rebase automatically: your balance grows from second to second, without any separate transaction being needed. Send 10,000 USDC to Aave V3 and you immediately receive 10,000 aUSDC. After a year at 5% APY, your wallet holds 10,500 aUSDC: 500 USDC extra, purely as interest yield.

It is crucial to understand this distinction:

• Principal: the 10,000 USDC you deposited, which for tax purposes is a non-taxable continuity transaction. You swap USDC for aUSDC of equal value and later swap back.
• Interest: the extra 500 USDC accrued through rebasing; this part is indeed taxable income at the moment of realization.

CryptoTax.be detects this distinction automatically. On an Aave V3 withdrawal, the engine calculates the difference between the aToken deposit (scaled via the on-chain liquidity index) and the underlying assets you receive back. The difference is booked as a separate INCOME event with the EUR value on the date of withdrawal.

⚙️ How is Aave interest taxed in Belgium?

The Belgian tax authorities have no specific crypto income category for DeFi interest. In practice there are three possible qualifications, depending on your situation:

The main rule: movable income (30%)

For most private Belgian investors who passively lend out assets via Aave, the interest yield qualifies as movable income (roerende inkomsten) within the meaning of article 17, §1, 3° WIB 92: "income from the rental, leasing, use and concession of movable property". Interest yields from the provision of capital traditionally fall under this category.

In recent administrative and case-law practice, DeFi lending yields are increasingly placed under this movable-income heading. The rate is 30%. Because Aave does not withhold tax at source, you must declare the yield yourself under code 1444/2444 (Vak VII of the personal income tax return).

When does the 33% miscellaneous income rate apply?

If the tax authorities consider your activities to be speculative (article 90, 1° WIB 92), lending yields can also be taxed as miscellaneous income at 33%. This risk is greater when you:

• frequently move in and out with large amounts,
• actively manage multiple DeFi protocols in a pattern resembling professional activity, or
• combine lending and speculative trading within a single portfolio.

If you are unsure about your qualification: request a ruling from the Ruling Commission (Dienst Voorafgaande Beslissingen, DVB). It provides a binding position for your specific situation.

💡 When does the taxable moment arise?

For aTokens, interest accrues continuously, but for tax purposes what counts is the moment of realization: the point at which you can effectively dispose of the interest. In practice there are two relevant situations:

• On withdrawal: the clearest moment. You receive more underlying assets back than you deposited. The difference (the interest) is realized and taxable at that moment.
• Ongoing accumulation (Aave V1/V2 rebasing): aTokens grow automatically in your wallet without an explicit receipt transaction. The taxable moment is less clear here. Some tax advisers argue that the periodic increase is already taxable at the moment of accumulation (just like interest on a savings account); others only when it can effectively be disposed of. We recommend aligning this point with a tax adviser for large amounts.

CryptoTax.be records both mechanisms: for V3, a separate INCOME event is generated on the date of withdrawal; for V1/V2, the rebasing balance is tracked so that the net yield is correctly calculated on withdrawal.

🧮 Worked example with figures

Suppose: on 1 March 2025 you deposit 10.000 USDC into Aave V3 on Ethereum, at a variable APY averaging 5% over the year.

What you declare in Tax-on-Web:

• Movable income → code 1444 (ToW: 1444-11/2444-78): enter €465 in Vak VII, section A.2.
• The return of the 10,000 USDC principal is not taxable; it is a continuity transaction.
• Gas fees paid for the supply and withdraw transactions may possibly be claimed as deductible costs (art. 49 WIB 92); discuss this with your tax adviser.

Mind the exchange rate: the USDC/EUR rate at the moment the interest is received (date of withdrawal) is decisive, not the rate at entry. CryptoTax.be automatically records the EUR value on the date of each INCOME event.

📋 How to declare in Tax-on-Web?

For income year 2025 (return 2026):

1. Log in to Tax-on-Web.
2. Go to Part 1 → Vak VII – Income from capital and movable property.
3. Choose section A.2 – "without withholding tax" (there is no withholding with DeFi protocols).
4. Under code 1444 (or 2444 for your partner), enter the total interest income in EUR.
5. In the detailed ToW interface you specifically use 1444-11 / 2444-78 for interest without withholding.

Do you also have speculative capital gains (e.g. from swapping aTokens or the underlying assets)? Those go to Vak XV, code 1440/2440. The two boxes are separate from one another.

🤖 How does CryptoTax.be detect Aave interest automatically?

CryptoTax.be processes Aave V1, V2 and V3 on Ethereum, Base and Arbitrum. Here is how it works behind the scenes:

• Aave V3: on each withdraw, the engine compares the aToken deposit (scaled via the on-chain liquidity index) with the underlying assets received. The difference is stored as a separate INCOME event with the EUR value on the date of withdrawal.
• Aave V1/V2: the engine retrieves the aToken balance just before withdrawal (one block earlier) and compares it with the original deposit. The difference is the accrued interest.
• Continuity treatment: the supply and withdraw transactions themselves are marked as non-taxable continuity events. This way they are not wrongly counted as a purchase or sale in your capital gains calculation.

In your CryptoTax.be report, an Aave withdrawal shows two events: one for the return of the principal (non-taxable) and one for the interest yield (taxable, type INCOME), each with the correct EUR value.

❓ FAQ: frequently asked questions

Do I have to declare aToken balances with the CAP (Central Point of Contact, Centraal Aanspreekpunt)?
No. Aave is a decentralized on-chain protocol, not a foreign financial institution. There is no CAP reporting obligation for on-chain DeFi wallets. You do, however, have to declare the interest income yourself in your tax return.

What about interest on ETH, WBTC or other non-stablecoins?
The principle is the same: the interest is taxable at the moment of realization, converted to EUR. Note: if the price of the underlying asset has risen sharply, the interest income in EUR can turn out substantially higher than expected based on the nominal APY.

Is the supply transaction itself taxable (USDC → aUSDC)?
No. CryptoTax.be treats the supply as a continuity transaction: you swap an asset for a representative token of equal value. No capital gain is realized. Only the interest yield on withdrawal is taxable.

What if I sold or transferred my aTokens in the meantime?
Then there may be a taxable realization moment at the time of that sale or transfer, both for the principal component and for the embedded interest. This is a complex situation; consult a tax adviser.

Can I deduct gas fees from my interest income?
Possibly, as proven costs related to generating the income (art. 49 WIB 92). This is not automatic; discuss with your tax adviser which costs are deductible in your return.

Does the same apply to Aave on Base or Arbitrum?
Yes. The tax treatment is independent of the network. CryptoTax.be supports Aave V3 on Ethereum, Base and Arbitrum.

🧾 Summary

✅ Let CryptoTax.be calculate this automatically

You do not have to calculate the interest yield yourself. Connect your Ethereum, Base or Arbitrum wallet to CryptoTax.be and our engine automatically detects all Aave supply, withdraw and interest events. Your report shows the taxable amount in EUR per INCOME event, ready to copy into Tax-on-Web.

Do you also want to map out other DeFi yields? Take a look at our guides on staking, Compound and other protocols.

Sources:

• FPS Finance (FOD Financiën): Personal income tax
• WIB 92: Income Tax Code 1992
• Aave Protocol: official documentation

⚙️ DeFi processed automatically
CryptoTax.be recognizes Aave V1, V2 and V3 on Ethereum, Base and Arbitrum. Connect your wallet and receive a Belgian tax report. Start your free scan →

⚠️ Disclaimer: This article is purely informational and not individual tax advice. For specific cases: consult a recognized Belgian tax adviser or request a ruling from the Ruling Commission (Dienst Voorafgaande Beslissingen).