The mobility budget in the starting blocks: Mobility budget as of 1 March!
On 28 February, the act introducing a mobility budget was approved in the Chamber and sent to the King for ratification and publication in the Belgian State Gazette. This act, applicable as of 1 March 2019, provides employees with the option of trading in their company car and accessories for a mobility budget. The mobility budget can be used for an environmentally friendly company car and/or durable modes of transport and, if applicable, the payment of the balance under an advantageous social security and tax treatment.
As of 1 March 2019, an employer who has put one or more company cars at the disposal of its staff for a period of at least 36 months, can offer its employees the option of taking up a mobility budget. There is an exception for new employers.
Employees that effectively have had a company car at their disposal for a period of 12 months during the 36 months preceding their written request for the mobility budget and for the 3 months immediately prior to the written request are eligible. Employees belonging to a job category for which a company car is provided under the applicable company car policy during these periods but have not effectively had a company car at their disposal, as well as new employees, are also eligible.
Upon being granted a mobility budget (if he/she has a company car) the employee trades in their company car and related benefits (fuel card, insurance, maintenance, etc.) and in turn receives the mobility budget.
This mobility budget amounts to the annual gross cost for the employer of the company car that has been traded in (or the company car the employee was eligible for), including tax and social security charges and related costs (financing costs / annual depreciations of 20%, fuel costs, insurance, solidarity contribution, etc.).
The employee can then spend the mobility budget within 3 pillars.
In the first pillar, the employee can opt for an environmentally friendly company car, either a fully electric company car or a company car with a maximum CO2 emission of 105 gr./km (as of 2020: 100 gr./km; as of 2021: 95 gr./km).
In the second pillar, alternative and durable modes of transport can be financed, in particular (i) soft mobility (purchase, maintenance and required equipment) such as a bike, speed pedelec, electric motorbike, etc. (iii) public transport such as a subscription for the employee to commute to and from work but also other public transport tickets (within the EEA), (iii) organised communal transport and share solutions such as carpooling and car-sharing, taxis and car rental with a driver, rent of vehicles without a driver for up to 30 calendar days per annum and (iv) the payment of rent and interest on a mortgage for a residence situated within a perimeter of 5 kilometres from the employee’s workplace.
The part of the mobility budget that is spent within the second pillar is fully deductible for the employer and fully exempt from social security contributions and tax for the employee.
For any part of the mobility budget remaining, there is a cash payment within the third pillar (in principle at the beginning of the following year or upon termination of the employment contract), after a deduction of a special employee’s contribution of 38.07%, but exempt from tax and fully deductible for the employer.
Finally, please note that the act amending certain provisions with regard to the mobility allowance (cash for car) was approved by the Chamber on 21 February 2019 and sent to the King for ratification and publication in the Belgian State Gazette. This act aligns the criteria the employees must meet to be eligible for the mobility allowance to those of the mobility budget.
> Action point
As of 1 March 2019, an employer can offer his employees the option of a mobility budget. Various actors already offer products that specifically fit within this legal framework. When you introduce the mobility budget, you should pay special attention to the drafting of a “mobility budget policy”.