On 5 December 2016, the Royal Decree dated 24 November 2016 which modifies the calculation of the advantage in kind for the personal use of a free of charge company car, has been published in the Belgian State Gazette.
The Royal Decree 24 November 2016 mentions the reference numbers for CO2-emission (hereafter the “CO2-reference”) for the calendar year 2017.
For cars with a gasoline, LPG or natural gas engine, the CO2-reference further decreases to 105 g/km. For diesel cars, the CO2-reference further decreases to 87 g/km.
The CO2-reference is used in the calculation of the advantage in kind for the personal use of a free of charge company car.
The Royal Decree 24 November 2016 is applicable to the advantages in kind granted as from 1 January 2017.
Formula
Since 1 January 2012, the advantage in kind for the personal use of a free of charge company car is calculated as follows (article 36 § 2, subparagraph 1 Income Tax Code 1992): catalog value x 6/7 x CO2 percentage.
Catalog value
The term “catalog value” is determined as follows: the catalog price of the car as new when sold to a private individual, including options and actual paid VAT, without taking into account any discount, reduction or rebate.
The catalog value of the car decreases by 6% every 12 months (to be counted as from the date of its first registration and a started month counts for a full month).
The maximum reduction is 30%. So when the car is more than 60 months (5 years) old, then the catalog value stops decreasing.
This “age adjustment” applies to both newly purchased cars as second hand cars.
CO2 percentage
The CO2 percentage depends on the CO2 emission of the car.
As from 1 January 2017 the CO2 percentage will be calculated as follows.
The CO2 base percentage is 5.5% for:
- a CO2 reference of 105 g/km for cars with a gasoline, LPG or natural gas engine; and
- a CO2 reference of 87 g/km for diesel cars.
For cars with a CO2 emission higher than the CO2 reference: 0,1% is added per each additional gram of CO2, up to a maximum of 18%.
For cars with a CO2 emission lower than the CO2 reference: 0,1% is subtracted per each gram of CO2 under the CO2 reference, up to a minimum of 4%.
In case the Department of Registration of Vehicles has no information regarding the CO2 emission of a certain type of car, it is assumed that the emission is equal to 205 g/km for a car with a gasoline, LPG or natural gas engine, or 195 g/km for diesel cars.
Minimum 1.260 euro
For 2016 the advantage in kind for the personal use of a free of charge company car was in any case at least 1.260 euro (indexed amount tax year 2017).
For 2017 the minimum amount of the advantage in kind has not yet been published in the Belgian State Gazette (indexed amount tax year 2018).
In case the advantage in kind is not granted free of charge and the employee has to pay a contribution to his employer, the contribution should be deducted from the calculated advantage in kind.
