Mobility budget amount: legal framework in 2025
Since the introduction of the mobility budget in Belgium, the law strictly regulates the amounts that can be dedicated to this scheme. The mobility budget is determined on the basis of the TCO (Total Cost of Ownership) of a company car, and it must comply with the ceilings and floors set annually by indexation. In 2025, the amounts are as follows:
The minimum amount of the mobility budget is set at 3,233 euros per year. If the calculated TCO is below this threshold, the mobility budget is automatically raised to this minimum.
The maximum authorised amount corresponds to the lower of the following two amounts:
20% of the employee's total gross annual salary,
17,244 euros per year. These amounts apply to the annual budget allocated within the framework of the mobility budget and are checked during implementation in RewardFlex.
What is the TCO?
The TCO, or Total Cost of Ownership, is an estimate of the total annual cost that the employer bears to make a company car available. It is not only the leasing or purchase of the vehicle, but all the costs related to its use. The TCO serves as a calculation basis for converting the car benefit into a mobility budget. This estimate must be carried out rigorously, as it determines the amount of the mobility budget.
The law recognises several levels of granularity in the definition of the TCO, depending on whether a simple, standardised or extremely detailed approach is adopted.
The different types of TCO
TCO 1️⃣ – Simplified TCO
The TCO 1 is a basic or simplified version, sometimes used in internal simulators or comparators. It is not compliant with the legislation on the mobility budget because it only takes part of the actual costs into account.
What the TCO 1 includes:
The monthly rental of the vehicle (leasing or long-term rental)
The costs of maintenance, tyres, repair and replacement
The road tax
The non-recoverable VAT on the amounts invoiced
The employer CO₂ contribution to the NSSO
The fuel and/or electricity costs
TCO 2️⃣ – The complete fiscal view (to be used for the Mobility Budget)
The TCO 2 adds a fiscal dimension to the TCO 1 by integrating the disallowed expenses, that is, the amounts that are not tax-deductible within the framework of corporate income tax or personal income tax.
What the TCO 2 adds to the TCO 1:
The taxation on disallowed expenses, notably:
The non-deductible car costs (insurance, maintenance, etc.)
The fuel costs (deductibility limited to 50% for PHEVs since 2023)
The benefit in kind (BIK) generated by making the vehicle available
The applicable taxation according to the tax deductibility rate of the vehicle (based, among other things, on its CO₂ emissions)
Why is the TCO 2 crucial? This calculation makes it possible to anticipate the tax impacts and the real costs borne by the company. It is the only version recognised for calculating a compliant mobility budget, notably in tools such as RewardFlex.
TCO 3️⃣ – The optimised approach
The TCO 3 is even more advanced. It takes into account the tax savings generated by the deductible expenses, in addition to the taxes due on the disallowed expenses.
What the TCO 3 additionally includes:
All the elements of the TCO 2
Minus the tax savings resulting from:
The partial or full deductibility of the car, fuel and CO₂ costs
The benefits related to electricity (100% deductible)
Advantage of the TCO 3: It reflects very precisely the net impact after taxation. Although less common, this calculation is appreciated by leasing companies or companies with a strong accounting sensitivity, as it makes it possible to precisely measure the tax return of the vehicle choice.
How to calculate the TCO within the framework of the mobility budget?
Step 1 – Choose what you want: a differentiated TCO per employee or an identical TCO per category?
Before calculating a mobility budget for an employee, the employer must choose a TCO calculation approach. This choice is structuring, as it will then have to be applied collectively to all the employees of the same category.
⚙️ Option 1: Identical TCO per category
The TCO is defined once for each job category, using:
A standard reference car
Or an average of the actual TCOs of the cars of this category
✅ Advantages
Time savings and consistency in processing
Standardisation of the rules
Ideal for SMEs or large homogeneous teams
⚠️ Disadvantages
Less personalised (a very mobile or very sedentary employee may lose or gain)
Must be rigorously justified and documented
⚙️ Option 2: Differentiated TCO
The TCO is calculated specifically for each employee on the basis of their current car or the car to which they are entitled and, above all, taking into account their personal fuel consumption.
✅ Advantages
Faithfully reflects the actual situation of the employee
⚠️ Disadvantages
More cumbersome administratively (multiple and precise calculations)
Different TCOs between the employees of the same category —> more complex monitoring
Lower predictability at the financial level as it depends on each individual situation
🚘 Using reference cars: a lever for simplification and consistency
When an employer sets up a mobility budget, they must calculate the amount of this budget (TCO) for each employee concerned. In principle, this calculation is individual, based on the vehicle actually made available or to which the employee would be entitled. However, the legislation allows an alternative: the use of a “reference car” per job category.
🧭 Why use a reference car?
The objective is to simplify the administration and ensure greater fairness between comparable employees. Instead of relying on the often heterogeneous history of vehicle allocations (often the case in SMEs), the employer defines a TCO on the basis of the average TCOs of the vehicles of each homogeneous employee group (e.g.: commercial functions, IT, managers…).
This makes it possible to:
Standardise the calculation of the mobility budget (TCO)
Avoid the disparities linked to past individual agreements
Facilitate the application of a lump-sum or actual calculation without having to trace the car costs car by car
Prepare for the possible generalisation of the mobility budget to all employees with a company car (expected from 2026)
⛽ And the fuel costs?
In the case where the employer decides to define an identical TCO per job category, the employer can also establish a reference fuel budget per job category (average of internal consumption).
🧠 Once the approach is chosen, it must be applied uniformly for 3 years for all the employees concerned.
Step 2 – Calculate the TCO according to the chosen approach
The mobility budget of an employee is calculated on the basis of the car to which the employee is entitled at the time of conversion:
If the conversion takes place at the end of the leasing, it is the new car planned for the employee that determines the budget.
If the employee does not yet have a car, it is the car for which they are eligible that serves as a reference for the calculation of the budget.
If the car is returned before the end of the leasing, it is the car currently used by the employee that serves as a calculation basis.
Depending on the different possible scenarios, here are the TCO calculation methods:
📌 1. If you have chosen a collective approach based on an identical TCO per category
The TCO is then the same for all the employees of the same job category.
🚗 1.1 — Define a reference car per job category
To define a reference TCO, the employer will have to calculate the average of the actual TCOs of the cars currently allocated to a given category. This reference TCO will serve to calculate the gross annual mobility budget of all the employees of this function.
🔄 This approach aims for consistency, fairness and administrative simplicity.
⛽ 1.2 — Define a standardised fuel budget
When using an identical reference car for a job category, it is also possible (but not mandatory) to define a reference fuel budget, instead of taking into account the actual home-work journeys of each employee.
This fuel budget will then be set as a lump sum based on the average of the actual consumption observed for this job category in the company.
⚠️ Important: this reference fuel budget serves only to calculate the TCO within the framework of the setting up of the mobility budget. But in pillar 1 of the mobility budget (environmentally friendly car), the fuel costs actually incurred by the employee will be taken into account at the time of the expense.
📝 1.3 — Concrete example
Category: « Commercial representatives »
Car of the category: Peugeot 3008 petrol or Renault Australe Hybrid
Actual average TCO observed: 9,400 €/year
Reference fuel budget (internal average): 1,500 €/year
➡️ The mobility budget allocated to each employee of this funct ion is set at 10,900 € (subject to compliance with the legal ceilings).
📌 2. If you have chosen a differentiated TCO calculation
Two possible calculation methods:
2.1 — Lump-sum method
This method is based on legal formulas set by a royal decree. It is composed of two parts:
a fixed component and
a variable component.
Fixed component:
Addition of the following elements:
Annual cost of the vehicle
In case of leasing: annual rental or leasing cost + the average annual cost of all the costs not included in the rental or leasing contract (if the company car policy provides for their financing) + non-deductible VAT + tax on the non-deductible car costs
In case of purchase of the car: the catalogue value of the vehicle (including the tax on the non-deductible part of this catalogue value) x 25%
Employer CO₂ contribution
These costs must be estimated realistically on the basis of the car policy or the contracts in force.
Variable component:
It covers the fuel costs related to the personal use of the vehicle, calculated according to a lump-sum formula: (6,000 km + [home-work distance × 2 × 200 days]) × 0.1335 €/km
6,000 km: lump-sum estimate of the annual personal journeys (legal amount)
0.1335 €/km: corresponds to 30% of the amount of the public kilometric allowance (valid from 1 June 2025)
Numerical calculation example
Context:
Car: Peugeot 308 diesel on leasing
Leasing: 450 €/month
Additional costs (washing, tyres, insurance): 75 €/month
Estimated non-recoverable VAT: 900 €/year
CO₂ contribution: 1,100 €/year
Home-work distance: 20 km Lump-sum calculation:
Fixed part: (450 + 75) × 12 = 6,300 € + 900 + 1,100 = 8,300 €
Variable part: (6,000 + 20×2×200) × 0.1335 = 14,000 × 0.1335 = 1,869 €
Total TCO = 10,169 €
2.2 — Actual cost method
This method is based on the actual and verified data of the company. The TCO corresponds to the average of the costs actually incurred for the company car over the last 4 years (or since the date of commissioning if < 4 years). 🧾 Cost items to include in the calculation:
Leasing or depreciation
If purchase: 20% of the purchase value per year
If leasing: annual rental × duration of the contract
Fuel or electricity costs
Total of the annual invoices, fuel cards, charging stations
Insurance
Annual premium paid by the employer (third-party liability + comprehensive)
Maintenance and repairs
Garage invoices, replacement of parts, technical inspections
Tyres and carwash
Replacement + regular cleaning services
Taxes
Registration, road tax, vignette
CO₂ NSSO contribution
Amount paid by the employer to the NSSO
Non-recoverable VAT
Non-deductible part on all the above expenses
Usual rate estimated between 35% and 50%, to be calculated according to professional/private use
Miscellaneous costs
Parking, home charging stations (if borne by the employer), roadside assistance
2.3 — To deduct from the TCO:
Personal contribution of the employee (if applicable) → Whatever the method chosen, if the employee pays a monthly contribution (e.g. 100 €/month), this represents a reduction of 1,200 € on the annual TCO.
2.4 — Business travel: should it be integrated into the TCO?
When calculating the TCO for the mobility budget, a key question arises: should I include the costs related to business travel in my calculation? The integration of business travel (e.g.: client visits, inter-site travel, external meetings) into the TCO is not mandatory. The employer can decide to include it or not in the calculation of the mobility budget.
Two possible scenarios:
1️⃣ If you do not integrate these journeys into the fixed component of the TCO:
They must be reimbursed outside the mobility budget
The employee can then receive an exempt kilometric allowance, according to the tax ceilings in force, or benefit from the reimbursement of their expenses for business travel
2️⃣ If you integrate business travel into the fixed component of the TCO:
They are covered by the overall mobility budget
The employee does not receive an exempt kilometric allowance or reimbursement of expenses separately for these journeys
FAQ – Which situations impact the amount of an employee's mobility budget?
💰 1. Revision of the mobility budget
Does the budget have to be reassessed each year?
No. The mobility budget does not have to be adjusted in case of a simple indexation or a one-off change in gross remuneration.
The budget is only revised if the employee:
Changes function,
Obtains a promotion,
Moves into a different vehicle category.
Change following a function change
The amount may change if the function or the vehicle category changes.
The adaptation of the budget takes effect from the 1st day of the month of the change.
🔄 2. Part-time
Part-time employees
For the calculation of the ceiling of 20% of the gross annual remuneration of a part-time employee, the calculation is based on the full-time gross remuneration.
If the change to part-time takes place after entering the system, the amount of the budget remains unchanged.
Special case
If the change to part-time results in the loss of the right to a car according to the company policy:
The mobility budget ends.
If the right is maintained with personal contribution, then:
The employer may reduce the budget, if this is provided for contractually and applied to everyone equally.
🔄 3. Indexation & impact of public scales
Indexation of the mobility budget
There is no legal obligation to index the budget.
The employer can provide their own indexation formula, if:
It is consistent between employees,
It respects the limits of the sectoral index,
It is formalised (individual or collective agreement).
A negative indexation can be imposed if linked to its own objective index.
Public scales
Public kilometric allowance :
The applicable amount is the one in force on the date of the request of the employee.
No retroactive modification of the mobility budget is required.
CO₂ solidarity contribution :
It does not impact the initial calculation of the mobility budget.
It can only influence certain pillar 1 expenses.
🚗 4. Car and mobility policy
Change of car policy
A new internal policy (e.g.: smaller models, switch to electric):
Does not impact the employees already in the system.
Only applies to new entries (new employees or renewal of right).
The employer cannot unilaterally modify the existing mobility budgets by adapting the car policy.
🔄 5. Relocation
Relocation of the company or of the employee
The amount of the mobility budget remains unchanged.
The change may affect the eligibility for certain pillar 2 expenses (e.g.: reimbursement of a rent or of loan interest).