Law & Tax Guide 2017

Transcription

1 Law & Tax Guide 2017

2 Athlon Law & Tax Guide 2017 Table of contents I. Taxation rules for passenger cars 4 1. Benefits in kind 5 2. Reclaiming VAT Tax deductibility of car costs Car registration tax Annual road tax CO 2 -solidarity contribution Compensation for kilometres The car s engine 27 II. Taxation rules for vans What is a van? Tax benefits Fuel 34 III. Taxation rules for bicycles, public transport and twowheeled vehicles Bicycles Scooters and motorbikes Public transport 44 IV. Flexible mobility FlexDrive 47 2 Law & Tax Guide

3 1. Benefits in kind I. Taxation rules for passenger cars An employee or manager who receives a company car from their employer and who also uses it for private use, obtains a significant benefit, the benefit in kind (BIK). The tax authorities consider the use of a company car as payment in kind. The employee or manager must pay tax on this. The employer is also taxed on this by way of corporation tax. In some companies, employees have to make a contribution for the use of their company car. This is a case of a benefit as described below, with the employee s own contribution deducted. 1.1 How do I calculate benefits in kind? The BIK is calculated using the following formula: list price x age of the car (%) x CO 2 (%) x 6/7 For 2017, the benefit may under no circumstances amount to less than EUR 1,280 per annum. That amount is reviewed annually based on the rate of inflation and technological progress of cars. You can find the up-to-date information [in Dutch or French] on: financien.belgium.be Example A new electric car such as the Nissan Leaf costs around EUR 30,000 including VAT. Formula: EUR 30,000 x 4% x 6/7 = EUR 1,037. The minimum amount for 2017 is EUR 1,280, however, so in this case the BIK will be EUR 1,280. You can have your BIK calculated for your company car through the Federal Public Service Finance web form: ccff02.minfin.fgov.be Law & Tax Guide

4 List price list price of the vehicle when new; including options; including VAT paid; excluding discounts or reductions*. * Promotional discounts from the list price and option packs may be eligible for consideration if they also apply to private purchasers and they are set by the importer. 6/7 of the BIK is to be borne by the employee and 1/7 (17% or 40%, see below) by the employer as a disallowed expense (non-tax-deductible company expense). Age of the vehicle To calculate the age of the vehicle, the list price is multiplied by the age of the car (%): Period elapsed since the first registration of the vehicle (a partial month counts as a whole month) from 0 to 12 months 100% from 13 to 24 months 94% from 25 to 36 months 88% from 37 to 48 months 82% Percentage by which the list price is multiplied CO 2 emissions of the vehicle The CO 2 (%) for 2017 is based on: 1. A basic percentage of 5.5% for a diesel car with CO 2 emissions of 87 g/km; for petrol, natural gas or LPG cars with CO 2 emissions of 105 g/km % per 1g/km more (to a maximum of 18%) % per 1g/km less (to a minimum of 4%) The basic CO 2 percentage is reviewed annually. You can find the up-to-date information [in Dutch or French] on: financien.belgium.be For an electric car with emissions of 0 grams of CO 2, the minimum percentage of 4% applies. If there is no information as to the CO 2 emissions of a car, the following values should be used: 195 g/km for diesel cars; 205 g/km for petrol, LPG or natural gas vehicles (CNG). 1.2 How do I calculate benefits in kind for the employee? The benefit in kind (BIK) is added to the employee s taxable income. The taxable income is the gross salary with national insurance (NI) contributions already deducted. The employee also has to pay taxes on that BIK. That occurs via payroll by calculating the withholding tax on the sum of the taxable wages and BIK. from 49 to 60 months 76% from 61 months onwards 70% Table 1: Age of the car (%) 1.3 What does the employer pay? Part of the BIK is paid by the employer or the company that provides the car. That part amounts to at least 17% of the BIK and is entered as a non-tax-deductible expense. The percentage of BIK that is entered as a non-tax-deductible expense goes up to 40% in 2017, when the company reimburses fuel costs associated with the personal use of the vehicle. This increase applies both in the case of a full and a partial reimbursement of the fuel costs. The extra non-tax-deductible expenses come to at least EUR (= 17% of EUR 1,280) or at least 512 EUR (= 40% of EUR 1,280). If you have any questions about the BIK you can go to the website of the Ministry of Finance: financien.belgium.be 6 Law & Tax Guide

5 Example An employee is deciding whether to go for an SUV or a hybrid estate. Car 1: Volvo XC60 diesel with CO 2 emissions of 124 grams Car 2: Volvo V60 hybrid with CO 2 emissions of 48 grams If the employee opts for the SUV, the BIK is EUR 3, per year. Depending on the employee s personal situation (gross salary, dependent children, mortgage etc.), he/she will pay +/- EUR 1,800 in taxes on this. If the employee opts for the hybrid estate, the BIK is EUR 1,280 per year. That comes to a good EUR 2, less. The net effect is around EUR 1,150 in taxes. Conclusion: by choosing smartly, the employee can save a lot in tax money. The employer also has to pay up to EUR 400 extra per year as non-tax-deductible expenses based on the choice of company car and the associated BIK. By taking into account the BIK, major savings can be made. 1.5 Shared cars If an employee has use of a pool car for commuting and/or personal trips during weekends, holidays or time off, a flat-rate estimated benefit in kind must be taxed based on the personal use. If the employee uses different pool cars with different list prices and/or CO 2 emissions, to establish the taxable benefit for that month, account is taken of the pool car most used by the employee concerned over the course of that month. The rules stated above apply to that car. 1.4 Athlon s advice Since the introduction of the new BIK regulation, employees are increasingly opting for green and tax-friendly alternatives. They see the impact of their choice reflected directly on their payslip. Given that employers also pay part of the BIK, it is best to make clear agreements on this subject. We recommend that you determine the budget that employees get for the choice of company car based on the Total Cost of Ownership (TCO). By including all taxes in this you can accurately compare different cars and engines (electric, hybrid, CNG, diesel, petrol). In this way you encourage employees to opt for cars that are both tax- and environmentally-friendly. At the same time, you retain control over your part of the BIK contribution. 8 Law & Tax Guide

6 2. Reclaiming VAT The sale or lease of a company car is subject to 21% VAT. VAT-registered employers can reclaim part of the VAT they paid. The right to reclaim VAT on company cars only applies if the car is to be used for business purposes. There are four methods through which companies can establish use for business purposes (see 2.2 How do I calculate the VAT to reclaim?). 2.1 What VAT I can reclaim? Employers can reclaim the VAT from such things as: car purchase and hire; fuel costs: whether they are diesel, petrol, lpg, but also alternative fuels such as electricity, CNG and hydrogen; repair and maintenance costs; purchase of accessories. Solution 2: flat rate for vans for both business and private use % business = 85% For vans that are used both for business and private purposes, you can opt for a flat rate of 85% for the business use of the van. Solution 2 is an option: if the van is primarily used to transport goods as part of the business activity. If that is not the case, the flat rate of 35% for passenger cars (see solution 1) applies; if you use the method for all of the company s vans that are used for both private and business purposes; if you use the method for 4 calendar years. Solution 3: partial flat-rate You can opt for a partial flat-rate calculation. In this case, the business use is calculated using the following formula: % private = (commuting distance in km x 2 x 200 working days) + 6,000 km x 100 total distance in km 2.2 How do I calculate the VAT to reclaim? A. For cost-free use of the vehicle If the employee does not make any contribution for the private use of the vehicle, there are four methods you can choose from to calculate the VAT to reclaim. These are based on the number of vehicles, and the category: passenger cars or vans. Solution 1: flat rate for passenger cars You can opt for a standard flat rate. That specifies the business use. % business = 35% The business use of a passenger car is set at a flat rate of 35%. Solution 1 is an option: for passenger cars; if you use the method for four calendar years (to be calculated from the year in which these methods were first applied). % business = 100% - % private Commuting distance: the distance between the home and the head office or place of work in km Total distance in km: the distance travelled in one calendar year in km (based on the vehicle s odometer) 200 working days: standard set amount of working days 6,000 km: standard set amount of kilometres for private use 50% is the maximum amount of VAT that can be reclaimed. Solution 3 is an option: for passenger cars; if the vehicle has a set user; if it is one vehicle per user. 10 Law & Tax Guide

7 Solution 4: logbook You can also opt to record the exact business use. Then you have to keep certain data for each car. 1. Daily business travel date of the journey; address at which the journey starts; destination address; amount of kilometres driven; total amount of kilometres driven per day. 2. The first and last readings on the odometer per year You can keep a log either manually (with a logbook) or automatically (for example with a GPS system). Business use is determined as follows: % business use = total number of kilometres for business use x 100 total distance in km 50% is the maximum amount of VAT that can be reclaimed for passenger cars. Solution 4 is an option: for passenger cars and vans. Please note: You can combine solution 3 (partial flat rate) and 4 (logbook) within your company. For solutions 3 and 4 you can use an average reclaim percentage for all vehicles of the same nature (passenger cars or vans). The flat rate method (solutions 1 and 2) may not be combined within categories (passenger cars or vans) with another method. However, a flat rate for passenger cars (solution 1) can be combined with the logbook method for vans (solution 4) and vice versa. All companies within a VAT group (companies may not charge VAT for products and services that they supply to other companies within the same group) must opt for the same solution within categories (passenger cars or vans). In all methods there is a part of the VAT that cannot be reclaimed. That percentage can be entered as a cost in the corporation tax in accordance with the tax-deductible percentages (see Chapter 3. Tax-deductibility of car expenses). B. With a contribution from the employee for the use of the vehicle If the employee pays a net amount to the employer for the private use of the vehicle, the tax authorities see this contribution as rent. Rent is subject to 21% VAT. In such cases, the VAT rules for the employer are the following: For passenger cars, the employer can reclaim 50% of the VAT for the costs of the car. For vans that are used both for business and private use, the employer can reclaim 100% of the VAT for the costs of the van. The employer must pay 21% VAT on the employee s contribution. The part of the threshold (see below) that is not yet paid must be offset through one of the four solutions. The VAT authorities may determine that the VAT levy needs to be increased if the employee contribution is lower than the threshold below. This depends on the actual business use and the annual car costs (the percentage of actual business use is determined using the method chosen for reclaiming VAT under 2.2.) Passenger cars: Threshold = annual car costs x (50% - % actual business use) Vans used for both business and private use: Threshold = annual car costs x (100% - % actual business use) For example: A company has two company cars (passenger cars) in its fleet: Employee A (representative) drives 20,000 km/year for work. She also drives 4,000 kilometres for private purposes. She lives 5 kilometres away from her work. Employee B (accountant, an office-based role) drives 2,000 km/year for business purposes. He also drives 15,000 kilometres per year for private purposes. He lives 20 kilometres away from his work. Which solution is the best for both employees? Employee A: Solution 3: partial flat-rate Private: 5 km x 2 x ,000 km = 8,000 km/year Total: 24,000 km/year 8,000 km/24,000 km = 33% Business use = 100% - 33% = 67% Maximum 50% VAT reclaimed 12 Law & Tax Guide

8 3. Tax deductibility of car costs Solution 4: logbook Logbook for business use = 20,000 km/24,000 km = 83% Maximum 50% VAT reclaimed Employee B: Solution 3: partial flat-rate Private: 20 km x 2 x ,000 km = 14,000 km/year Total: 17,000 km/year 14,000 km/24,000 km = 82.4% Business use = 100% % = 17.6% VAT reclaim 17.6% Solution 4: logbook Logbook business use 2,000 km/17,000 km = 11.8% VAT reclaim 11.8%. Through the partial flat rate system the employer can reclaim VAT of 50% and 17.6% respectively. At first glance, that is less than the flat rate of 35% for both, unless the vehicle to which the 50% VAT reclaim applies is considerably more expensive. There are of course arguments for administrative simplicity, which are also important to bear in mind in the final decision. 2.3 Questions? For general questions you can contact the FPS Finance Contact Centre at +32 (0) For more specific questions it is best to get in touch with your local VAT office. Companies can include car costs, relating to the purchase, hire and use of the company car (including the nondeductible part of the VAT), as expenses in their corporation tax. The car costs can be deducted fully or partially from the taxable base. The tax deduction percentages vary between 120% and 50%. For sole traders, liberal professions and employees who are taxed via personal income tax, the percentage deductible is 75%. 3.1 How do I calculate the amount of tax deductible? 120% tax deductible These costs are 120% deductible: all car costs for electric cars (except the electricity which is seen as a fuel cost); electric charging infrastructure: with the purchase of an electric vehicle, the cost for fitting one charging point at home and one charging point at the office can be deducted. 2.4 Athlon s advice Since the new VAT rules took effect, many companies have opted for the 35% flatrate VAT reclaim where previously 50% applied. This is a considerable additional cost for companies. It is essential to have a clear overview of the commuting patterns of employees. If the majority of employees use their company car primarily for business use, solution 3 (partial flat rate) or solution 4 (logbook) should be considered. This will mean more VAT can be reclaimed. This does however mean that you have to be aware of the commuting distance for all employees and record the number of kilometres driven per year. However, thanks to modern digital solutions, keeping a logbook is a much simpler matter these days. Feel free to talk to your account manager to discuss the best solution for your fleet together. 100% tax deductible These costs are 100% deductible: interest; mobile telephone in the car (device and hands-free kit are deductible) vans; parking costs for staff with own car, clients and suppliers; construction of a company car park. 14 Law & Tax Guide

9 75% tax deductible These costs are 75% deductible: fuel costs: whether they are diesel, petrol, lpg, but also alternative fuels such as electricity, CNG and hydrogen; taxi costs. CO 2 emissions diesel CO 2 emissions petrol 100% electric 0 g 120% 0-60 g 0-60 g 100% Tax deductibility limited to * Based on the CO 2 emissions and fuel type g g 90% The tax deductibility of the car costs below depends on the CO 2 emissions and the type of fuel used by the vehicle: the depreciation of the vehicle and accessories; maintenance; repairs; vehicle safety tests; tyres; emergency assistance; car wash; insurance; road tax; car registration tax; parking fees for company cars and parking tickets g g 80% g g 75% g g 70% g g 60% > 195 g > 205 g 50% Table 2: Tax deductibility based on CO 2 emissions Example The Mercedes B Class is available with different engine types. Each engine type has different CO 2 emissions. This determines to a great extent the proportion of car costs that can be included in the corporation tax. CO 2 emissions Tax deductible Mercedes B Class Diesel B 220 d % Mercedes B Class Petrol B % Mercedes B Class Natural Gas Drive (CNG) % Mercedes B Class Electric Drive 0 120% 16 Law & Tax Guide

10 4. Car registration tax Given that the deductible tax varies greatly, it is essential that you bear this in mind when determining the Total Cost of Ownership (TCO). As a rule, if you have to choose between vehicles: the more CO 2 friendly, the more tax friendly. 3.2 Athlon s advice For many employers, calculating the impact of the tax deductibility is no simple task. Fortunately, Athlon has developed all the tools necessary to largely automate this calculation for almost all vehicles available on the Belgian market. This will help you make a considered choice. One simple aid is the addition of a CO 2 ceiling in your car policy. Nowadays, a maximum of 120 grams is considered a realistic limit. Moreover, we advise you to reduce that ceiling year after year. For 2020 it is best to aim for a maximum of grams. In that way, your car policy will be well on the way to a financially advantageous and environmentally friendly future. The car registration tax is the tax you pay when you purchase a new vehicle or a second-hand vehicle and wish to drive it on public roads. This tax only has to be paid once. Where your company is based or where you live determines the region in which you have to pay the car registration tax. 4.1 How do I calculate the car registration tax? For cars registered in the region of Flanders Since 1 January 2016, the car registration tax has changed in Flanders. From then on, the tax also takes into account the environmental impact of the car, such as the EU emission standards and CO 2 emissions. The new calculation only applies to private individuals or companies that register a car in their name, not for lease vehicles. Lease vehicles are, as before, taxed on the basis of the tax treatment (hp, dependant on cc) and the engine power (kw). The new tariffs apply only for new or second-hand vehicles registered in Flanders from 1 January The cars already on the road since before 1 January 2016 do not fall under the new legislation. Hybrid vehicles, electric vehicles, hydrogen vehicles and CNG vehicles do not have to pay any car registration tax until You can calculate the car registration tax for your vehicle on the website of the Flemish tax authorities. Have your car s certificate of title (pink form) handy: belastingen.vlaanderen.be If you have any questions on car registration tax you can go to: The Flemish tax service (VLABEL) Tel: 1700 (Flemish information hotline, free on working days from 9 AM to 7 PM) verkeersbelastingen@fb.vlaanderen.be belastingen.vlaanderen.be 18 Law & Tax Guide

11 5. Annual road tax For lease vehicles and vehicles registered in the Brussels-Capital region and the Walloon region The car registration tax in Brussels and Wallonia is determined on the basis of the tax horsepower (hp, dependant on cc) and the engine power (kw). This method of calculation also applies to lease vehicles. LPG vehicles get a discount. Below you will find the car registration tax tariffs for the Brussels-Capital region and the Walloon Region for cars that use diesel or petrol: The road tax is the tax you have to pay every year as the driver of a motorised vehicle on public roads. Where your company is based or where you live determines the region in which you have to pay your road tax. Car registration tax for passenger cars, dual-use cars and minibuses 5.1 How do I calculate my road tax? Cyl. in l* hp kw Age of the vehicle From 0 to 12 to to to to months months months months months to 8 0 to and to to to to to 120 1, , and to 155 2, , , , , > 3.4 > 17 > 155 4, , , , , Table 3: Car registration tax tariffs for the Brussels-Capital region and the Walloon Region * cylinder in litres For cars registered in the region of Flanders Since 1 January 2016, road tax has gone green in Flanders. From then on, the annual tax will take into account CO 2 emissions and emission of pollutants. The taxable horsepower of the car continues to be the basis for calculation but it can go up or come down based on both EU emission standards and CO 2 emissions. The new calculations only apply to private individuals or companies that register cars in their name, not for lease cars. Lease vehicles are, as before, taxed on the basis of the tax treatment (hp, dependant on cc) and the engine power (kw). The new tariffs apply only for new or second-hand vehicles registered in Flanders from 1 January The cars already on the road registered before 1 January 2016 do not fall under the new legislation. The road tax is adjusted to the index every 1 July. Electric cars, hydrogen cars, CNG cars and plug-in hybrids with emissions of less than 50 g CO 2 /km do not need to pay road tax until LPG vehicles get a discount of up to 100 EUR on their annual road tax. You can calculate the road tax for your vehicle on the website of the Flemish tax authorities. Have your car s certificate of title (pink form) handy: belastingen.vlaanderen.be For the Brussels-Capital region, you can find more information on the car registration tax [in Dutch or French] on: financien.belgium.be For the Walloon region, you can find more information on the car registration tax [in French] on: 20 Law & Tax Guide

12 6. CO 2 -solidarity contribution If you have any questions on road tax you can go to: The Flemish tax service (VLABEL) Tel: 1700 (Flemish information hotline, free on working days from 9 AM to 7 PM) verkeersbelastingen@fb.vlaanderen.be belastingen.vlaanderen.be For leasing cars and cars registered in the Brussels-Capital region and the Walloon region The road tax in Brussels and Wallonia for passenger cars is determined on the basis of the tax treatment (hp, dependant on cc) and the engine power (kw). Lease cars also follow this method of calculation. You can find the tariffs for road tax for the Brussels-Capital region [in Dutch or French] on: financien.belgium.be You can find the tariffs for road tax for the Walloon region [in French] on: Trailers Trailers benefit under certain conditions from an exemption for road tax in Flanders: The trailer may have a maximum authorised mass (MAM) of 750 kg. A passenger vehicle, a dual-use car, a minibus, an ambulance, a motorbike, a light commercial vehicle, a camping van, a bus or a coach may carry the trailer. The vehicle must be registered in the name of a natural person residing in the Flemish region, or in the name of a legal entity registered in the Flemish region. Employers who provide their employees with a vehicle that is also for private use must pay a solidarity contribution to the National Insurance Office. This monthly amount is based on the CO 2 emissions and the type of fuel of each vehicle. The flat-rate contribution is linked to the health index for September and is adjusted on 1 January of each year. The index coefficient for 2017 is How do I calculate the CO 2 solidarity contribution? Fuel CO 2 emissions Formula Petrol CO 2 known [((CO 2 -emission x 9 EUR) - 768) / 12] x CO 2 not known [((182 x 9 EUR) - 768) / 12] x = EUR Diesel CO 2 known [((CO 2 -emission x 9 EUR) - 600) / 12] x CO 2 not known [((165 x 9 EUR) - 600) / 12] x = EUR Lease vehicles do not fall under this measure and must therefore pay road tax when they carry a trailer. The tariffs can be found on: belastingen.vlaanderen.be LPG [((CO 2 -emission x 9 EUR) - 990) / 12] x Electric EUR per month Table 4: Calculation of CO 2 solidarity contribution in 2017 An LPG vehicle is a converted car that originally used petrol. The figure used for the formula is that of the CO 2 emissions of the petrol vehicle. The minimum contribution is EUR per month. 22 Law & Tax Guide

13 Example The Opel Zafira is available with different engines. Here, we will compare the petrol and diesel types: CO 2 emissions Opel ZAFIRA TOURER Diesel 1.6 CDTi ecoflex 109 Opel ZAFIRA TOURER Benzine 1.4 Turbo 150 Diesel: [((109 x 9 EUR) - 600) / 12] x = EUR per month Petrol: [((150 x 9 EUR) - 768) / 12] x = EUR per month When choosing between two models it is therefore best to bear the CO 2 solidarity contribution in mind; the difference in this example is already 20 EUR a month. 6.2 Athlon s advice The CO 2 emissions of a vehicle are a crucial factor in a lot of tax aspects of company cars. If you would like to bring the solidarity contribution down to a minimum, having a CO 2 ceiling for vehicles is considered a smart choice. In this way you eliminate any unnecessary extra costs in your fleet. 24 Law & Tax Guide

14 7. Compensation for kilometres 8. The car s engine Employees who use their own cars for business travel can be compensated for this in two different ways. Either the employer reimburses the actual costs incurred or pays a flat rate based on kilometres. How do I calculate my compensation for kilometres? From 1 July 2016 to 30 June 2017 the flat rate of compensation for kilometres is EUR per kilometre. The reimbursement to the employee is not taxed. The employer can include the compensation for kilometres as a deductible expense. The number of kilometres travelled may go up to a maximum of 24,000 kilometres per year. If the employer pays more than the flat rate of EUR per kilometre and if the amount is far more than the actual costs, this can be seen as part of the salary. In such a case, the employee is taxed and has to make national insurance contributions. 8.1 Alternative fuels Fuels are 75% tax deductible. That also applies to alternative fuels. The electricity costs of charging stations are also considered fuel costs and are therefore tax deductible. You may have to be able to prove the exact electricity consumption of a hybrid or electric vehicle to the tax authorities. The best solutions to eliminate arguments as to the electricity consumption is to fit a smart charging station that can register the consumption. With the purchase of an electric vehicle, the cost for fitting one charging point at home and one charging point at the office can be deducted 120%. The costs for charging at home can therefore be reimbursed by the employer as well as 75% deducted. The offer of a charging station at home to the employee who opts for a hybrid or electric vehicle, has no impact on the benefit in kind (BIK). 8.2 Fuel cards In the budget for 2017, it was decided to more heavily tax fuel cards for employers. That is achieved by hiking up the percentage of the BIK (which is payable by the employer). That percentage goes up to 40% if the employer provides a fuel card that the employee may also use for private purposes (or if the employer pays fuel costs including for private use). 26 Law & Tax Guide

15 1. What is a van? II. Taxation rules for vans Some employees, because of their work, need a spacious vehicle with room to load goods. The taxation rules for vans, also called light commercial vehicles are more advantageous than for standard company cars. The tax authorities refer to a real or tax light commercial vehicle when: the vehicle is designed and intended for transporting goods; the vehicle without load does not weigh more than 3.5 tonnes; the ratio between the length of the loading space and the distance between the two wheel axles is at least 50%; the loading surface has a horizontal space for loading goods, with no anchor points for extra seats or seatbelts. Please note: Not all light commercial vehicles are considered light commercial vehicles for tax purposes. A large luxury 4x4 does not count for example. It is seen as a false light commercial vehicle. The tax authorities do not base their decision on the details of the Vehicle Registration Department (DIV) but on the technical inspection. Even if a company only offers services (and does not transport goods), it is entitled to the tax benefits of a van, with the exception of reclaiming VAT. The VAT check takes into account actual use. An accountant with a van will therefore in principle not benefit from being able to reclaim 85% of the VAT but will be able to reclaim the 35% allowed for passenger cars. You will find more information on the distinction between real and false light commercial vehicles [in Dutch, French and German] on: vwnewswgfisc_nl/633ddbcbd0fc91f0c1257be cd?opendocument#. Vm9FKkrhCUl Law & Tax Guide

16 2. Tax benefits Benefits in kind For vans that fall in the category of real light commercial vehicles, the benefit in kind (BIK) is calculated based on the actual value that the vehicle offers to the employee. This calculation, in the case of few kilometres for private use, is often more advantageous than the flat-rate tax rules for standard company cars. Benefit in kind = actual cost of the vehicle x (kilometres private use/total amount of kilometres travelled) To find out how the BIK is taxed, see 1.2 (for the employee) and 1.3 (for the company), p. 7 To find out how the BIK is calculated for a false light commercial vehicle, see the rules for passenger cars, 1. Benefits in kind, p. 5 Example A company buys a light commercial vehicle for 25,000 EUR. The employee drives 30,000 kilometres per year, of which 5,000 are for private purposes. The costs for diesel and maintenance are 5,000 EUR. Depreciation occurs at five years. Benefit in kind = (25,000 purchase/5 years + 5,000 EUR in costs) x (5,000 km private use/30,000 km total) = 10,000 x = 1,667 EUR VAT The VAT that can be reclaimed is determined based on whether the employee uses the vehicle for private purposes or not. The tax authorities consider commuting as private use, regardless of whether the vehicle is a real or false light commercial vehicle. Free use: The vehicle is not used for private purposes: the VAT can be 100% reclaimed. The vehicle is used for private purposes, including commuting: Solution 2: flat rate. 85% of the VAT can be reclaimed if the van is primarily used to transport goods (see also passenger cars, 2.2 How do I calculate the VAT to reclaim?, p. 10). Solution 4: logbook (see also passenger cars, 2.2 How do I calculate the VAT to reclaim?, p. 10). With employee contribution If the employee pays a contribution for the use of the vehicle (see 2.2 How do I calculate the VAT to reclaim?, p. 10). For vans that are used both for business and private use, the employer can reclaim 100% of the VAT for the costs of the van. The employer must pay 21% VAT on the employee s contribution. The part that is not yet paid must be offset through one of the two solutions for vans (see the formula in 2.2 How do I calculate the VAT to reclaim?, p. 10). Tax-deductibility Costs, including fuel costs are 100% tax-deductible in the case of a (real) van. Sole traders are entitled to a tax deduction for investment for the purchase of a light commercial vehicle. In such a case, the vehicle may only be used for work. The vehicle may be subject to accelerated or degressive depreciation. Additional costs at the time of purchase may be deducted once. Car registration tax Vehicles that are registered as light commercial vehicles are not subject to car registration tax. Road tax The road tax for vehicles registered as light commercial vehicles is determined until 1 July 2017 by the weight of the vehicle. From 1 July, a change will be introduced in Flanders. Flemish region Up until 1 July 2017, the annual road tax is still calculated based on mass. From 1 July onwards, the road tax for vans and light commercial vehicles is linked to CO 2 emissions. This measure only applies for new vehicles. For vans which are already on the road, there is no change for the time being. The amount of road tax is based on EUR per 500 kg MAM (maximum authorised mass). That amount is multiplied by 0.30% for each gram of CO 2 per kilometre over and above 122 grams. The reverse also applies: for each gram under 122 grams, a deduction of 0.30% applies. The European standards and the type of fuel also impact the final amount to be paid. In the case of vans above 2.51 tonnes, no account is taken of the type of fuel. 30 Law & Tax Guide

17 Electric vans will be exempt from road tax from 1 July. For vans on natural gas (CNG), there is an exemption up to You can calculate the road tax for your vehicle on the website of the Flemish tax authorities. Have your car s certificate of title (pink form) handy: belastingen.vlaanderen.be Brussels-Capital region and the Walloon region The employer pays less road tax for a van if it is a real light commercial vehicle. The weight of the vehicle determines the annual tax to be paid. This varies from EUR for a vehicle weighing less than 500 kg to EUR for a vehicle from 3,001 to 3,500 kg. The tariffs are index-linked annually on 1 July. Road tax for light commercial vehicles CO 2 solidarity contribution For vans considered real light commercial vehicles, the national insurance does not consider commuting as private use. If a real light commercial vehicle is only used for business travel and commuting, the employer does not have to pay a CO 2 solidarity contribution. Pure private use by the employee is prohibited in this case. For vans that do not fall under the description of real light commercial vehicle, the national insurance sees commuting as private use. In such a case, the employer has to pay a CO 2 solidarity contribution. If the employee also uses the van for private use (regardless of whether it is a real or false light commercial vehicle), the national insurance asks for a CO 2 solidarity contribution. The amount depends on the type of fuel of the vehicle and the CO 2 emissions but is never less than EUR (2017). To calculate the CO 2 solidarity contribution, use table 4 on p. 23). Maximum authorised mass in kg from to Amount of annual tax EUR (minimum tax) EUR EUR EUR EUR EUR EUR For lease cars or commercial lease vehicles the road tax is included in the monthly lease amount. For vans that are false light commercial vehicles the same rules apply as for passenger cars. 32 Law & Tax Guide

18 3. Fuel The rules on fuel are the same for vans as for passenger vehicles. They can be found on p Law & Tax Guide

19 1. Bicycles Voor bestelwagens die niet voldoen aan de omschrijving voor echte lichte vracht, beschouwt de sociale zekerheid woon-werkverkeer als privégebruik. Dan is de werkgever een CO 2 -solidariteitsbijdrage verschuldigd. Gebruikt een werknemer de bestelwagen ook privé (ongeacht of het om een echte of een valse lichte vracht gaat), dan vraagt de sociale zekerheid een CO 2 -solidariteitsbijdrage. Het bedrag hangt af van het brandstoftype van het voertuig en III. Taxation rules for bicycles, public transport and twowheeled vehicles de CO 2 -uitstoot, maar is nooit minder dan 25,55 euro (2016). Voor de berekening van de CO 2 -solidariteitsbijdrage geldt tabel 4 op pagina 23. Cycling to work is good for our health and for the environment. With the Bikelease formula, Athlon offers companies and employees an advantageous option to leave cars or company cars parked more often. Insurance, assistance and maintenance are included. The employee can therefore use the bicycle on the road with no worries. 1. Advantageous for the employee A lease bicycle is not a benefit in kind (BIK) to the tax authorities as long as the bicycle is also used for business travel, including commuting. The employee does not pay any benefit in kind on the lease bicycle. The company may reimburse for the kilometres covered for commuting. The bicycle reimbursement is exempt from income tax up to 0.23 EUR per kilometre. The bicycle reimbursement may be combined (non-accumulative) with other benefits such as a train season ticket. For professional use (including commuting), cyclists are covered by the employer s insurance. It is best to check with the insurer if private use is also covered. The bicycle reimbursement only applies to actual kilometres covered by bicycle for business travel. If the employee is off sick for example, no reimbursement is paid. The burden of proof of the kilometres travelled lies with the cyclist. Please note: The exempt bicycle reimbursement may not be entered in the payslip under Contribution to travel expenses. If it is, the employee is taxed. The tax authorities make no distinction between lease bicycles and personal bicycles for the bicycle reimbursement. Law & Tax Guide

20 Example Employee A cycles 6 kilometres to work every day. The employer pays a benefit of 0.20 EUR per kilometre. A receives an average of 48 EUR, exempt of taxes (EUR) x 6 (km) x 2 (there and back) x 20 (actual working days) = 48 EUR 2. No lease costs for the employer Costs for lease bicycles and accessories (bags, bicycle trailers etc.) are fully tax deductible. Purchase costs for bicycles are 120% deductible. Costs for bicycle reimbursements are fully tax deductible. Extra facilities (construction of bicycle parking, showers etc.) are 120% tax deductible. The VAT is only deductible to the extent that the bicycle is used professionally. The employer does not need to pay social security contributions for professional use of the bicycle. The employer does, however, pay a contribution for the private-use part. Example Company X offers 8 employees a lease bicycle with a value of 60 EUR a month. Together, the employees cover an average commuting distance of 1,280 kilometres per month. The employer may deduct the full cost for the bicycles (736 EUR) for tax. [8 (employees) x 60 (EUR bicycle lease)] + [8 (employees) x 0.20 (EUR) x 4 (km) x 2 (there and back) x 20 (actual working days)] = 480 EUR (bicycle lease) EUR (kilometre reimbursement) = 736 EUR per month The first two categories have been subject to the same rules as standard bicycles for quite some time (apart from a few details). The same applies to the tax rules. The employee does not have to pay any BIK on private use, on the condition that the bicycle is also used for commuting. The employee can also receive a bicycle reimbursement of 0.23 euros per kilometre. There is a draft bill for a law to subject speed pedelecs (high-speed electric bikes) to the same tax treatment as standard bicycles. Up to now, they have been subject to the rules for class B mopeds. The change in the law will mean that employees who commute with these speed pedelecs will also receive a bicycle reimbursement of 0.23 euros per kilometre. Furthermore, they will not be taxed on the benefit in kind. Employers who offer speed pedelecs as company bicycles benefit from 120 per cent corporation tax deductibility. According to the draft bill, the changes to the law will take effect in the 2018 assessment year (i.e. for income in 2017), but this date is still provisional. Athlon does not offer speed pedelecs in its Bikelease formula. 3. Electric bicycles For those who live slightly further away from their work, an electric bicycle could be a solution. Since 1 October 2016, new rules are in force, which make a distinction between three types of electric bicycles: Bicycles with an electric auxiliary engine ( 250 watt and 25 km/hours): these bicycles only have pedal assist. Motorised bicycles ( 1000 watt and 25 km/hour): alongside pedal assist, these bicycles can also have an engine that offers throttle on demand, without the rider actively pedalling. Speed pedelecs ( 4000 watt and 45 km/h): the highway code no longer considers these bicycles, but rather as a class B moped. 38 Law & Tax Guide

21 2. Scooters and motorbikes Opting to travel to work with a two-wheeled vehicle has many advantages. You get to your destination faster, especially in the city, and you can enjoy a range of tax benefits. Purchased/leased by the employer Benefits in kind An employee who receives a company car from his/her employer and who also uses it for private use, obtains a significant benefit, the benefit in kind (BIK). For company scooters or motorbikes, the BIK is calculated based on the actual value that the vehicle offers to the employee. This calculation often comes out, in absolute terms, as more beneficial than a company car. The tax rules are comparable to those for vans (see p. 28). Benefit in kind = actual cost of the vehicle x (kilometres private use/total amount of kilometres travelled) To find out how the BIK is taxed, see p. 7. Employees who have both a company car and a company scooter or motorbike, pay BIK twice. Tax deductibility for the employer The costs of the scooter or motorbike are 100% tax deductible for the employer. There are no limits here given that the BIK is charged for the private use. The VAT can only be reclaimed for the actual business use. The number of kilometres travelled for business purposes is demonstrated with a record of kilometres (see also calculation of BIK above). No flat rate applies for scooters or motorbikes. Purchased/leased by the employee Employees who purchase their own scooter or motorbike can deduct the costs for commuting and business travel from taxes in accordance with the rules below. They can also be reimbursed by their employer for business travel. Here the law does not make any distinction between the kilometre reimbursements for passenger cars (see 7. Kilometre reimbursement, p. 26). In principle, the employer can deduct 100% of the kilometre reimbursement for scooters and motorbikes from tax. The employee can deduct a lot of business and usage costs for motorbike users for tax as long as he/she does not opt for applying a statutory flat rate tax deduction for business expenses: Costs for business travel are fully deductible for taxes. Costs for commuting are partially deductible. The employee can choose between using a flat rate of 0.15 EUR per kilometre travelled and proving actual costs. The deductible costs include: fuel; insurance; road tax; car registration tax; protective motorcycle clothing; costs of repairs; depreciation; finance interest. Costs for kilometres travelled for private use with a motorcycle are not tax deductible. The distinction between business and private use is thoroughly supervised. If a motorcycle is for example used for private purposes during the weekend, an option could be to deduct costs at a rate of 5/7 (five out of seven days). 40 Law & Tax Guide

22 Electric scooters and motorcycles The purchase of an electric motorcycle entitles the employee to a tax advantage of 15%. This amount is capped to a maximum of 3,010 EUR (fiscal year 2016, income 2015) and is index-linked annually. The tax deduction applies to electric vehicles that: are new (so no second-hand motorcycles); have only an electric engine (so no hybrids); can carry at least two people (including the driver); may only be used with a valid driving licence. The tax deduction is limited to the actual amount paid. Those who do not need to pay taxes do not get the balance paid back. Car registration tax Flemish region You can calculate the car registration tax for your motorcycle on the website of the Flemish tax authorities. Have your car s certificate of title (pink form) handy: belastingen.vlaanderen.be Brussels-Capital region and the Walloon region For motorcycles registered in Brussels and Wallonia, the same tariffs apply as for passenger cars (see 4.1 How do I calculate the car registration tax?, p. 19). Road tax Flemish region You can calculate the road tax for your motorcycle on the website of the Flemish tax authorities. Have your car s certificate of title (pink form) handy: belastingen.vlaanderen.be Brussels-Capital region and the Walloon region In Brussels and Wallonia, the road tax for motorcycles is EUR. This amount applies until 30 June It is index-linked annually on 1 July. 42 Law & Tax Guide

23 3. Public transport Public transport is not only better for the environment than cars. But in our busy traffic, taking the train or bus is sometimes even faster and more practical. With Railease, employees can choose the most efficient mode of transport at any time. 1. Advantageous for the employee An employer can reimburse the employee for a bus or train season ticket or offer a lease formula (a company car combined with train or bus journeys). The use of public transport for commuting or business travel is not considered a BIK by the tax authorities. The user therefore does not need to pay any additional BIK. Railease can also be financed by the employer, as well as by the employee himself/ herself. They can opt to invest part of the car budget in Railease. That means that the employee can benefit from the advantages of a company car, and the comfort of trains, with no additional costs to the employer. Example An employee is entitled to a car budget of 560 EUR per month. After choosing her vehicle, there is a remainder of EUR a month, which he or she would like to invest in public transport. He or she uses Railease forty days a year in combination with the Brussels transport company MIVB. Thanks to Athlon s formula, for the company, this means no additional cost because both means of transport are financed through the car budget. Railease is 100% tax deductible for the company (including in combination with other transport companies). During the forty days provided for, the employee may make unlimited use of the train & MIVB s transport services without paying any additional BIK for that. Please note: The tax authorities enter a flat rate for business expenses in the tax declaration as standard. If the employee opts to declare actual expenses, the reimbursement for public transport is taxable. In such a case, the employee can enter 0.15 EUR for each kilometre covered by public transport for commuting. 5. Tax exemption for the employer It is compulsory for employers to make a financial contribution to employees commuting costs if they opt for public transport. The employer contribution comes to an average of 75% of the ticket or season ticket price. This rule does not apply to Railease. The contribution by the employer in the form of a reimbursement of the season ticket or of the costs of Railease is 100% tax exempt. In a lease formula, the additional cost of train or bus journeys are compensated by reducing the amount of kilometres travelled by car. The employer bears the costs for business travel. Reimbursements for bicycle journeys and public transport are 100% tax deductible. 44 Law & Tax Guide

24 1. FlexDrive Voor bestelwagens die niet voldoen aan de omschrijving voor echte lichte vracht, beschouwt de sociale zekerheid woon-werkverkeer als privégebruik. Dan is de werkgever een CO 2 -solidariteitsbijdrage verschuldigd. Gebruikt een werknemer de bestelwagen ook privé (ongeacht of het om een echte of een valse lichte vracht gaat), dan vraagt de sociale zekerheid een CO 2 -solidariteitsbijdrage. Het bedrag hangt af van het brandstoftype van het voertuig en de CO 2 -uitstoot, maar is nooit minder dan 25,55 euro (2016). Voor de berekening van de CO 2 -solidariteitsbijdrage geldt tabel 4 op pagina 23. IV. Flexible mobility A range of options for the same company car budget: that is the philosophy behind FlexDrive. 1. How does it work? The employee chooses a more advantageous car and saves part of the monthly budget. He or she can use the remainder for a variety of extras: a people carrier for the summer holidays, a ski box, a bicycle rack, or a removals van for a day. 2. Why FlexDrive? The employee has to sacrifice less salary if the benefit in kind (BIK) (see p. 5) is considerably lower. This is possible by choosing a greener car or a car with a lower list price. The employee gets a flexible mobility solution for all situations, for example a rental car when he or she flies off on holiday. The lease cost for the employer stays the same. FlexDrive also has clear advantages for the employer: the fuel costs are lower and green, economical vehicles are easier to pass on. For FlexDrive lease vehicles, all the same tax rules apply as for standard lease vehicles (see p. 4). Example An employee is entitled to a car budget of 560 EUR per month. For 100 EUR a month, he or she signs up to FlexDrive and orders a car for a monthly cost of 460 EUR. The BIK he or she has to pay for this car comes to EUR a month. He or she goes skiing and uses a 7-seat people carrier for 7 days. For this he or she pays a BIK of EUR. The BIK he or she has to pay that month is calculated as follows: ( EUR/31) x 24 = EUR for the long-term vehicle EUR for the Flex vehicle. That comes to a total of EUR for that month. Law & Tax Guide