In June this year, the federal government reached agreement on a draft law on the greening of company cars. The text has not yet been finalised. However, as the fiscal impact on your fleet is quite significant and the switch to a green fleet takes time, we are already giving you the broad outlines.
Deduction limitation on car expenses in personal and corporate income tax
As of 2026, only the purchase of an electric or hydrogen-powered car will be tax deductible and there will be a number of transitional rules for the existing fleet.
The changes apply to both corporate and personal income tax. There will be three deduction rules that are determined by the purchase date of the car.
1. Cars bought before 1 July 2023
For cars bought before 1 July 2023, the existing rules will remain in force indefinitely. That means a tax deduction of between 40% and 100%, depending on the CO2 emissions. It is important to know that a gradual reduction will be built into the deduction because the existing formula will be recalculated every year based on the average CO2 emissions of the whole Belgian fleet.
There is an exception in personal income tax. Cars purchased before 1 January 2018 will always remain at least 75% deductible.
2. Cars purchased between 1 July 2023 and 31 December 2025
The formula based on CO2 emissions will remain in force but with some adjustments. First of all, the minimum deduction of 40% will disappear. Secondly, the maximum deduction will decrease year by year: in 2025 it will be 75%, in 2026 50%, in 2027 still 25% and finally, in 2028, 0%.
3. Cars bought as of 1 January 2026
Only electric cars and hydrogen-powered cars will still be tax deductible, but the deduction will also be reduced per year of purchase: 2026 – 100%, 2027 – 95%, 2028 – 90%, 2029 – 82.5%, 2030 – 75%, 2031 – 67.5%. It will remain constant for the entire useful life of the vehicle.
Incentive for the installation of publicly accessible charging stations
Companies will be allowed an increased expense deduction of 200% of their outlay for the installation of publicly accessible charging stations from 1 September 2021 to 31 December 2022, and 150% from 1 January 2023 to 31 August 2024.
For the purchase of an emission-free truck, a refuelling installation for hydrogen-powered cars or an electric charging station the investment deduction will be increased. This will drop from 35% in 2023 to 13.50% in 2027.
Private individuals receive a tax deduction if they install a green electricity charging station at home that can also control charging time and power. Between 1 September 2021 and 31 August 2024 this reduction will drop from 45% to 15%.
No change to benefit in kind for private use
For users, employees and managers, nothing should change. The benefit in kind determines how much personal income tax users have to pay for private [A1] use of their car. The main criterion in this is CO2 emissions. Two standards exist for this purpose, the original NEDC standard and the new WLTP standard. The WLTP standard is generally stricter, with a small exception for some hybrid cars. Application of the WLTP would therefore result in a higher personal taxable benefit. Contrary to the original intent, one may continue to calculate on the basis of the NEDC CO2 value.
Increase in the NSS contribution paid by employers
For each company car that an employee drives, the company must pay the NSSO a solidarity contribution that also depends on the CO2 emissions. The minimum monthly contribution for 2021 is € 27.54. This contribution will be significantly increased for non-emission-free cars (to 5.5 times as much from 2027). However, vehicles in service before 1 July 2023 will escape this increase.
VAT regime will not change
In terms of VAT, nothing will change for the time being: the VAT deduction for passenger car expenses varies between 35% and 50%. Obviously this applies only to companies that are fully liable for VAT.
Mobility budget more accessible as of 1 September 2021
The purpose of the employee mobility budget is to spend the budget for the company car for which they are eligible on other items, such as a bicycle, scooter, public transport passes for the family, car sharing or even the rent or mortgage for a house within a radius of 10 kilometres of the workplace.
It remains to be seen whether the amendments to this measure will be successful.
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