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What is a benefit in kind for recharging electric vehicles?
A benefit in kind occurs when the employer provides goods or services to its employees free of charge or at a cost lower than their actual value. This includes the provision of an electric vehicle or charging station at the workplace. This benefit enables employees to reduce their out-of-pocket expenses, which is considered a form of indirect remuneration and is subject to social security contributions.
What is the legal framework for electric cars?
The benefit in kind for an electric vehicle can be assessed in two ways: on a flat-rate basis or based on actual expenses.
| Calculation method | Purchased vehicle | Leased or leasing vehicle | Comments |
|---|---|---|---|
|
Flat-rate |
9% of purchase cost (6% if vehicle > 5 years old) |
30% of total annual cost (rental, maintenance, insurance) |
If the employer pays for fuel, add 3% for purchased vehicles or 10% for leased vehicles. 50% allowance capped at €1,800 per year for electric vehicles. |
|
Actual expenditure |
20% of purchase price + insurance + maintenance costs |
Total cost of rental + maintenance + insurance |
Apply the percentage of private mileage to the total. Electricity costs are not included in the benefit in kind for electric vehicles until the end of 2024. |
Good to know: there are specific regulations governing charging stations!
The provision of a charging station at the workplace until December 31, 2024 is valued at €0. No benefit in kind is to be declared for personal use of the charging station. If the charging station is installed outside the workplace, the costs of purchase, installation and use borne by the employer must be included in the basis for social security contributions.
Importance for companies and employees
Adopting electric vehicles offers many financial and tax advantages for companies, while improving their brand image and environmental responsibility:
- Tax and financial benefits: companies are exempt from TVS and vehicle registration tax, and also benefit from higher tax deductions for the depreciation of electric vehicles.
- Lower operating costs: the absence of fossil fuels reduces fuel and maintenance costs.
- Brand image and social responsibility: By integrating electric vehicles into their fleets, companies demonstrate their commitment to the environment, thereby enhancing their brand image.
- Subsidies and grants : Companies benefit from various subsidies and grants (ecological bonus, conversion bonus, regional aid).
Employees also benefit from in-kind advantages linked to the use of electric vehicles, making significant savings and actively participating in the ecological transition.
- Personal savings: Benefits in kind enable employees to make savings (fuel and maintenance costs). In addition, tax exemptions and allowances make these solutions financially more attractive.
- Comfort and convenience: Having a company electric vehicle means you can recharge the vehicle at home or at work. This eliminates the need to make detours, and means you can always set off with a full battery.
These benefits show that integrating electric vehicles and charging infrastructure into the workplace is a winning strategy for both employers and employees, aligning economic and ecological objectives in a harmonious way.
Also read → Employer reimburses the cost of recharging an electric vehicle
How to calculate the benefit in kind for charging electric vehicles?
Using a calculation simulator
To assess the benefit in kind of charging electric vehicles, the use of a dedicated calculation simulator greatly facilitates the process. These tools enable you to quickly obtain an accurate estimate of the benefit in kind to be declared, based on the specific parameters of each situation.
Simulators simplify the calculation process by automating complex steps. They take the various variables into account:
- vehicle type,
- vehicle age,
- mode of acquisition (purchase or lease),
- employer to cover the cost of recharging.
These tools are regularly updated to reflect the latest tax and social security regulations. Using a fringe benefit calculator is simple and intuitive.
- Go to a platform offering a simulator, such as the site AGS Conseil Paie or other similar online tools.
- Enter the above information about the electric vehicle
- The simulator automatically calculates the benefit in kind based on the data provided.
Calculation methodology
Calculating the benefit in kind for electric vehicle charging involves several precise steps. Here is a clear methodology to guide you through the process:
Step 1: Determine the cost of purchasing or leasing the vehicle
- Electric vehicle purchased : Take the purchase cost of the vehicle, all taxes included. For example, for a new electric vehicle costing €30,000.
- Leased electric vehicle: Take the overall annual cost of the lease, including maintenance and insurance. For example, €10,000 per year.
Step 2: Calculate annual depreciation
- Electric vehicle purchased : Annual depreciation of 20% of the purchase cost if the vehicle is less than 5 years old, or 10% if it is more than 5 years old.
- Example: €30,000 * 20% = €6,000 per year for a vehicle less than 5 years old.
Step 3: Add insurance and maintenance costs
- Add annual insurance and maintenance costs.
- Example: €1,000 insurance and €500 maintenance, for a total of €1,500.
Step 4: Calculate the percentage of private mileage
- Calculate the percentage of private mileage in relation to total mileage.
- Example: If an employee drives 15,000 km a year, including 9,000 km for private use, the percentage is 60%.
Step 5: Apply the 50% allowance to the total
- Apply a 50% rebate on total costs for electric vehicles, with a ceiling of €1,800 per year.
- Example: Total costs = €6,000 (depreciation) + €1,500 (insurance and maintenance) = €7,500
- Private percentage = €7,500 * 60% = €4,500
- After 50% allowance: €4,500 * 50% = €2,250, capped at €1,800.
Step 6: Subtract any employee contributions
- If the employee makes a financial contribution, this amount is deducted from the calculated benefit in kind.
- Example: If the employee pays €300, the final benefit in kind is €1,800 - €300 = €1,500.
By following this methodology, you will be able to calculate the benefits in kind for charging electric vehicles in your company accurately and correctly. This guarantees fiscal transparency and cost optimization for both employer and employee.
Also read → How to manage your electric vehicle fleet
The pros and cons of offering in-kind benefits for electric cars
Switching to electric vehicles offers companies attractive opportunities in terms of tax breaks and sustainable branding. However, this transition also involves financial and logistical challenges. The table below highlights the main benefits and obstacles to consider before taking the step to an electric fleet.
| Benefits for the company | Disadvantages and challenges |
|---|---|
|
Tax deductions of up to €30,000 for depreciation of electric vehicles, compared with €20,300 for internal combustion vehicles. |
Higher acquisition cost (up to 20% more than a combustion-powered car) |
|
Lower energy costs thanks to electricity consumption that costs less than conventional fuel |
Charging infrastructure still limited, especially in rural areas. |
|
Reducingcarbon footprint, improving Corporate Social Responsibility (CSR) |
Recharge time longer than filling a fuel tank |
|
Enhancing brand image and attracting talent sensitive to environmental issues |
Electric vehicle range inferior to that of internal combustion vehicles, despite ongoing improvements |
|
Compliance with environmental regulations: quotas for low-emission vehicles from 2024, with thresholds rising until 2030. |
Dependence on expensive raw materials (lithium, cobalt) used in batteries. |
Conclusion
The adoption of electric vehicles in companies continues to grow worldwide. Businesses benefit from many advantages, including tax deductions and a reduced carbon footprint. However, they must also overcome challenges such as high initial cost and limitedcharging infrastructure. By balancing these benefits and challenges, companies can make informed decisions to effectively integrate electric vehicles into their fleets.
