🇧🇪 Belgium
🚗 Car & mobility
Taxation
2026 switch
Company cars in Belgium 2026: calculating the benefit in kind
Roughly one Belgian employee in five drives a company car, and almost none of them know how the "benefit in kind" line on their payslip is worked out. Yet it is a four-factor formula, one of which shifts against you every year. And 2026 seals the switch on the employer side: a combustion car ordered this year is no longer deductible at all.
📖 9 min read
🕐 Updated August 2026
🇧🇪 All of Belgium
A company car available for private use is a benefit in kind: the tax authority treats it as remuneration in kind and taxes it accordingly. The benefit is added to your taxable income, which raises your withholding tax — it does not lower your gross salary, it raises the tax on it.
Two calculations run in parallel and are often confused: the employee's, who pays tax on the benefit, and the employer's, who deducts — or no longer deducts — the vehicle's costs. This page covers both, in that order.
The calculation, as published by FPS Finance
Annual benefit = catalogue value × 6/7 × age percentage × CO₂ percentage
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Catalogue value — options included, discounts excluded
The vehicle's list price when new, VAT included, options included, disregarding any discount. That is the biggest surprise: negotiating 20% off at the dealership does not reduce your benefit in kind by a cent.
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Age percentage — 6 points a year, floor at 70%
100% from 0 to 12 months, 94% from 13 to 24, 88% from 25 to 36, 82% from 37 to 48, 76% from 49 to 60, then 70% from 61 months on. Age counts from first registration, including under a previous owner.
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CO₂ percentage — between 4% and 18%
Formula: 5.5 + (vehicle CO₂ − reference CO₂) × 0.1. The result is capped at 18% and cannot fall below 4%. Electric vehicles sit at 4% by default.
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The 6/7 factor
A flat coefficient set by law, deemed to represent private use. It does not depend on your actual mileage, nor on your home-to-work distance.
2026 reference emissions: the tightening screw
| Engine type |
Reference CO₂ — 2026 income |
| Petrol, LPG, natural gas | 70 g/km |
| Diesel | 58 g/km |
⚠️ The benefit on the same car rises every year, twice over. On one side, reference emissions fall as the Belgian fleet electrifies: each gram off the reference adds 0.1 point to the CO₂ percentage of every existing car. On the other, the age coefficient only falls 6 points a year and stops at 70%. The result: on a combustion car, the rising CO₂ percentage eventually outruns the fall from ageing.
A statutory floor applies in all cases: the benefit cannot be lower than €1,690 a year for 2026 income (against €1,650 for 2025 income).
Three worked examples
| Vehicle |
Catalogue value |
CO₂ % |
Annual benefit (new car) |
| Electric — 0 g/km | €45,000 | 4% (minimum) | €1,542.86 → raised to €1,690 |
| Petrol — 120 g/km | €35,000 | 10.5% | €3,150 |
| Diesel — 150 g/km | €40,000 | 14.7% | €5,040 |
The electric example illustrates the floor nicely: the calculation gives 45,000 × 6/7 × 100% × 4% = €1,542.86, below the statutory minimum. So €1,690 is what appears on the payslip.
💡 What the benefit actually costs you
The benefit is not taken from your account: it is added to your taxable base. At a 50% marginal rate, a €3,150 benefit therefore costs roughly €1,575 in tax a year, or about €130 a month in lost net pay. Compare that with the real cost of owning the same car privately — fuel, servicing, insurance, taxes and depreciation included. Our page on understanding your payslip shows where that line appears.
Employer side: 2026, the year of the switch
The deductibility regime for cars has been tightened step by step. In 2026 there is no trade-off left.
⛽ CO₂-emitting vehicles
Deductibility: 0%
•
For a combustion vehicle
ordered from 1 January 2026, no tax deduction is possible at all — 0% from the first year.
•
What counts is the
order date or the date the lease was signed, not delivery.
•
Vehicles ordered earlier keep their original regime, under the transitional rules applying at their order date.
🔌 Fully electric vehicles
Deductibility: 100%
•
An electric car bought or leased in 2026 remains
100% deductible.
•
That rate is set to taper for acquisitions in later years: the later you order, the less you deduct.
•
The deduction rate acquired at ordering is in principle locked in for the whole holding period.
⚠️ The CO₂ solidarity contribution is rising too. The employer pays a monthly contribution to the NSSO for any vehicle made available for private use. For emitting vehicles bought, rented or leased since 1 July 2023, the multiplier rises to 4 on 1 January 2026 — enough to quadruple the contribution compared with an electric car. Zero-emission vehicles are not exempt: a minimum contribution remains due.
The practical consequence: Belgian car policies are shifting en masse to electric, not out of conviction but out of arithmetic. For an employer the question is no longer "electric or combustion" but "electric or mobility budget".
Reducing your benefit in kind: what works
1
A personal contribution
A deduction from net salary agreed with your employer is set off against the taxable benefit. It therefore lowers the tax due. Careful: the payslip shows the gross benefit, and the contribution is accounted for in the tax return — check your 281.10 form mentions it.
2
Choosing a model with a low catalogue value
Catalogue value carries the most weight and is the only factor you really control when choosing. Options inflate the catalogue value and therefore the benefit, year after year.
3
Going electric
CO₂ percentage pinned at 4%, the absolute minimum. On a high catalogue value, the benefit gap with an equivalent combustion car runs into thousands of euros a year.
4
Considering the mobility budget
Swapping the car for a mobility budget lets you fund housing close to work, public transport or a bike, often with far more favourable tax treatment. That is the subject of our page on the mobility budget.
✅ The sum to do before saying yes. A company car is not a gift: it is remuneration, taxed at your marginal rate. Compare the annual tax on the benefit with the full cost of the same vehicle privately. If you drive little, the mobility budget or a
raise in cash often pays better.
The case of the self-employed in a company
A director who makes a company vehicle available for private use is in the same boat: same benefit formula, same €1,690 floor, same deductibility regime on the company side.
Two practical differences matter:
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VAT follows its own rules
VAT deduction on a mixed-use vehicle is limited to actual business use, and in any event to 50% maximum. That is a completely separate regime from corporate tax deductibility — see our page on VAT for the self-employed.
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The company vs sole trader trade-off shifts
With combustion cars at 0% deductibility, one of the classic arguments for incorporating loses much of its weight. The full calculation is in our page on SRL or sole proprietorship.
The most common pitfalls
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Believing a discount lowers the benefit
It does not. Catalogue value is assessed disregarding discounts, rebates or fleet terms. Two colleagues with the same car have the same benefit, whatever the employer paid.
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Confusing order date with delivery date
For deductibility, the order fixes the regime. A combustion car ordered in late 2025 and delivered in 2026 does not fall under the 2026 rules — and the reverse holds too.
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Thinking low private mileage reduces the benefit
The 6/7 factor is flat. Whether you drive 500 or 20,000 private kilometres a year, the benefit is identical. Only a personal contribution reduces the taxable benefit.
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Forgetting the cost of charging at home
Charging a company car at home uses your electricity. Reimbursement by the employer has to be organised — and installing the charging point deserves its own calculation: see home charging point.
🕐 Last verified: August 2026 — Benefit formula, age coefficients, 2026 reference emissions and minimum benefit taken from the official FPS Finance "company cars" page. The worked examples are direct applications of that formula.