Tax treatment of company cars in 2023
In 2022, the federal government took a number of measures to make the vehicle fleets of Belgian companies more environmentally friendly. The intention is clear: vehicles with combustion engines should no longer be on the road by 2026.
In order to achieve this objective, the applicable tax benefits will be steadily scaled back. It’s therefore well worth taking the time to examine the tax treatment of company cars.
Tax deductibility of fossil-fuel vehicles
Vehicles purchased before 1 July 2023
Nothing will change for these vehicles. The cost of a vehicle purchased by you or your company before 1 July 2023 will remain deductible to the same extent as it is now and for the lifetime of the vehicle. The tax deductibility of the vehicle and fuel costs is calculated according to the following gram formula:
Deductible percentage = 120% - (0.5 x fuel coefficient x grams of CO2 )%
(Fuel coefficient: diesel = 1 / petrol/LPG = 0.95 / CNG < 12 hp = 0.90)
Important: Vehicles with emissions of 200g or more can never deduct more than 40%. Vehicles with emissions of less than 200g can deduct a minimum of 50% and a maximum of 100%.
Vehicles purchased in the period from 1 July 2023 up to and including 31 December 2025 (transitional phase):
Fossil-fuel passenger cars (diesel, LPG, CNG or petrol) purchased in the period from 1 July 2023 up to and including 31 December 2025 are subject to a transitional arrangement. Starting from 2025, the deductibility of costs according to the gram formula will be gradually capped as follows:
Vehicles purchased on and after 1 January 2026
Vehicles purchased after 31 December 2025 that run (partly) on fossil fuel will no longer be tax deductible.
Tax deductibility of carbon-free vehicles
Purchased before 1 January 2027
As stated above, the tax deductibility of fossil-fuel company cars is calculated using the gram formula. Given that electric cars and hydrogen-powered cars emit zero grams of CO2, their associated costs are 100% deductible. This 100% deduction applies to the full lifetime of carbon-free vehicles purchased before 1 January 2027.
Purchased on or after 1 January 2027
The deductibility of costs associated with carbon-free vehicles bought after 31 December 2026 will gradually be limited to 67.5%. A transitional arrangement has been agreed which means that for this type of vehicle, the deduction will depend on the year of purchase during the transitional phase:
|Purchase date||Lifetime deductibility|
|Before 1 January 2027||100%|