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Tax and social security
Compensation & Benefits

The law passed Wednesday in Parliament modifies the legal framework of the mobility budget. In addition, the legislator intends to limit the tax deductibility of company car expenses and to encourage the installation of electric charging stations.

Main changes to the mobility budget

Changes have been made to strengthen the mobility budget. This system allows employees to exchange their (right to a) company car for a mobility budget calculated on the basis of the Total Cost of Ownership (TCO) of the company car. This budget can then be spent on mobility solutions. Any balance is paid out in cash in a (para)fiscally advantageous way.

From 1 January 2022, the employer will have the possibility, when determining the mobility budget, not to take into account the costs resulting from the professional use of the company car, provided that he compensates the costs incurred by the employee for his professional travels elsewhere. The annual amount of the mobility budget will be a minimum of EUR 3,000 and a maximum of one fifth of the total gross annual remuneration, with an absolute ceiling of EUR 16,000. For mobility budgets granted before the date of publication of the new law, these minimum and maximum amounts will only be applicable from 1 January 2023. It is also foreseen that the King may determine a formula by which the amount of the mobility budget must be calculated.

In addition, the waiting periods (3 months/12 months) currently imposed on the employee in order to benefit from the mobility budget are abolished. Eligible employees will therefore be able to apply for a mobility budget immediately.

Until now, the employer was not obliged to offer each of the three pillars. From now on, the employer will be obliged to make at least one offer to employees under pillar 2 (sustainable modes of transport).

With regard to the choices in the pillars, it should be noted that from 1 January 2026, in pillar 1, only fully electric cars will be considered environmentally friendly.

In pillar 2, the obligation to choose a CO2-free vehicle will also apply to all motorised soft mobility vehicles, as well as to car-sharing and car-pooling solutions and car rental services with driver. In addition, the financing of public transport season tickets is extended to all family members of the employee living in the same household. As regards the financing of housing costs by means of pillar 2, the employee’s residence must now be located within a radius of 10 kilometres of the usual place of work instead of 5 kilometres at present. Finally, pillar 2 can also be used to pay a pedestrian allowance or to finance certain parking costs.

Tax deductibility of car expenses

The aim of this law is to make the company car fleet emission-free. Thus, from the income year 2026 onwards, only emission-free company car expenses will still be deductible. For vehicles acquired before 1 January 2026, a transition period has been introduced.

In summary: for vehicles acquired until 31 December 2022, the current deduction regime remains in force. In other words, the tax deductibility depends on the CO2 emission of the vehicle. The principle is that the higher the vehicle’s CO2 emissions, the lower the deductibility rate.

For vehicles acquired from 1 July 2023 onwards, the deductibility method remains the same except for petrol and diesel costs, where the deductibility percentage cannot exceed 50%.

For vehicles acquired from 1 January 2026 onwards, only costs relating to the use of a zero-emission car will be deductible. In addition, the deductibility rate will decrease over time. The percentage will be 100% for vehicles acquired in 2026 but will be gradually reduced to 67.50% for vehicles acquired from 2031 onwards.

Tax incentives for the installation of charging stations

This law provides for an increased depreciation rate for the installation of charging stations for electric vehicles accessible to the public, subject to certain conditions. This rate is 200% for investments made between 1 September 2021 and 31 December 2022. For investments made between 1 January 2023 and 31 August 2024, the rate is reduced to 150%.

In addition, a tax reduction is also granted to individuals who install a charging station in or near their home. The tax reduction is equal to 45% of the expenses paid in 2021 or 2022. It is then reduced to 30% in 2023 and 15% in 2024. The amount for which the tax reduction is granted may not exceed EUR 1,500 per station and per taxpayer. The granting is also subject to compliance with certain conditions. The main conditions are that the charging station must be intelligent (i.e., with control of charging time and power) and that the electricity used by the charging station must be supplied on the basis of a green electricity contract.

Action point

Many changes have been made to the taxation of mobility. It is important to pay attention to these changes when setting up a car policy or a mobility budget and to take into account the fiscal impact for the employer, since the law aims to limit the tax deductibility of company cars in the future.