From now on, employers must include company bicycles on a tax statement, and the employee must include the amount in their tax return. This is confirmed by a circular from the tax authorities, which wants to check whether the employee has to pay tax on this.
“The amount, the benefit of the company bicycle, is exempt from tax if the employee opts for the flat-rate deduction of professional expenses,” says Francis Adyns, spokesperson for the Federal Public Service Finance. “Only if an employee proves his actual professional costs will there be an impact,” says Olivier Vanneste of the consultant KPMG.
The government decided last year that anyone who proves their actual professional expenses is no longer entitled to tax exemption, and will therefore be taxed on their lease bicycle. The same applies to the bicycle allowance. The tax exemption is therefore only available for those who opt for the lump sum expense deduction in their tax return.
Administrative hassle
According to KPMG, the new rule will entail additional administrative burden for companies. ‘Many employers now have to complete additional formalities for what is actually only a limited problem.’
The government’s intention is to prevent employees from having to pass the checkout twice: first through the tax exemption for the bicycle and then again by claiming the bicycle costs through the actual professional costs. “But there are very few employees in Belgium who prove their actual professional costs and even fewer who also claim the bicycle costs,” says Vanneste.
The measure applies to all bicycles that are made available by an employer to an employee from 1 January 2024. Current contracts are therefore also included. “Even if the bicycle was purchased or leased by the employer several years ago, as long as it is still made available to an employee, it must be reported on the tax return,” says Vanneste.
Many employers now have to complete additional formalities for what is actually only a limited problem.
Olivier Vanneste
Consultant KPMG
What amount appears on the tax form? This concerns the costs of purchasing or leasing the bicycle and all related services, such as insurance and maintenance. ‘Leasing is about annual rent. When making a purchase, the tax authorities say that the benefit is determined on the basis of the purchase price of the bicycle including accessories, spread over five years,” says Vanneste.
The impact for those who prove their true costs can be significant. “If you receive a bicycle allowance of 1,000 euros, and we calculate with the highest tax rate of 53.50 percent, the change will cost 535 euros,” says Vanneste.
‘For a bicycle lease, this can be even higher. Anyone who leases a speed pedelec for 250 euros per month will pay 1,605 euros in taxes. In those cases, it may no longer be interesting to claim the actual costs, but to opt for the flat-rate deduction of professional costs (5,750 euros for the income year 2024).’
