Electric cars and charging stations: how do you calculate the benefit of all nature?

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The government has given the green light to a greener commercial vehicle fleet, with electric cars in the lead. But in order for those cars to circulate effectively, a lot of charging stations will obviously have to be installed.

Therefore, we refresh for you the tax implications in case an employer provides charging stations and/or electricity:

In the coming years, the government will also develop tax incentives with the intention of accelerating the growth of charging stations. Those incentives deserve a separate explanation and are therefore not discussed in the article below.

The benefit of all nature of electric commercial vehicles

Employees or company directors (hereinafter "employees") who also use their company car privately are taxed on the benefit they derive from it: the benefit in kind (SG&A). The value of that SG&A is estimated at a flat rate according to a formula in which two parameters are important: the catalog value × 6/7 and the CO2-emissions of the commercial vehicle. The lower those parameters, the lower the SG&A and therefore the final tax will be.

Electric cars have minimal CO2-emissions

Because electric cars do not directly emit CO2 emit, the tax authorities take into account a flat-rate minimum base rate of 4% to calculate the SG&A. Consequently, the calculation formula for electric cars is:

SG&A = catalog value × 6/7 × 0.04

The SG&A of electric cars therefore falls surprisingly low, even at high list values.

ExampleThe SG&A of an electric Tesla Model 3 with a list value of €55,000 is only €1,885.71 per year (55,000 × 6/7 x 0.04). That's relatively little for such an expensive car.
Charging fees are included in the benefit of all nature

When the employer provides a charging infrastructure, both the cost of installing and using it are included in the SG&A. So this is good news, because the employer's charging of these costs does not trigger additional SG&A from the employee.

Specifically, the VAA of an electric company car for private use includes:

  • The employer's funding of the home charging infrastructure of the employee or manager.
  • The electricity that the employer provides to charge the car
  • The cost of electricity consumption incurred by the employer refunds to charge the car

Electricity refund vs. charging at employer

The tax treatment of the electricity needed to charge the provided electric vehicle is different according to the specific situation:

  • Can the employee recharge the car at the employer or does the employer reimburse the cost? What if the employer provides neither?
  • Are they professional moves or private moves?
  • What rules does the industry anticipate?
Employer reimburses electricity costs

When the employer reimburses the employee's electricity costs, the following distinctions should be made:

  • The employer provides a charging station along with a company car at the employee's home: in that case, no additional benefit all nature arises for the reimbursement of electricity costs. There is then one benefit of all kinds for the car AND the electricity;
  • The employee himself installs a charging station at his home: then a additional benefit all nature Upon reimbursement of electricity costs by the employer.

In the latter case, you should include electricity consumption split into three categories:

Type of displacementTreatment of reimbursement
Occupational travelReimbursement by the employer is an employer's own expense. The employee is not taxed on this.
CommutingEmployer reimbursement is a taxable SG&A, of which €420 per year is exempt from tax (income 2021)
Private travelThe employer's allowance is a VAA on which the employee is fully taxed.

Attention! Do you wish to reimburse the charges on flat base? If so, it is best to ask for a ruling to.

Your employee can recharge at work

Do you want your employees to literally leave after work feeling recharged? If so, consider letting them use a charging station at work for free. Employees with an electric company car should not fear additional taxation in this case, as this benefit is already included in the flat-rate SG&A resulting from the provision of the electric company car (see above). In other words, there is only one benefit of all kinds charged.

The arrangement is different for employees who have their private car may charge at work. We discuss that situation later in this article .

Your employee gets a charging station at home

What if along with providing an electric company vehicle, you also installed a charging station at an employee's home? Both the installation of that pole as the refund Of the electricity consumption of that pole does no fringe benefit of any kind arise with the employee or manager.

Thus, in this situation, too, only one benefit in kind is taxed: the benefit estimated on a flat-rate basis and resulting from the provision of the electric company car (see above).

Only a company car, no intervention in electricity

Some employers will only provide an electric car, without intervention in electricity costs. The employee must therefore provide this himself. This electricity is then not part of the provision of the car and therefore not part of the benefit in kind either.

This has two implications:

  1. The cost borne by the employee for electricity consumption is not in the nature of an "own contribution. The employee can therefore do not deduct from the SG&A to reduce his or her taxes.
  2. In some sectors, the employer is required to intervene in commuting costs. The pure allocation of an electric company car is not enough in this case, a reimbursement of electricity costs will also be required.

What if the employee charges his private car at work?

Recently, the tax administration ruled on an employee who charges his private car at the charging stations on company premises. He receives a personal badge for this purpose, so the cost of electricity is individualizable. That cost is then perused to the employee, but to an lower price than the employee would normally have to pay for it.

According to the tax authorities, a benefit in kind, equal to the following difference, arises in that case:

  • The amount the employee in normal circumstances should pay For electricity to charge his car
  • Reduced by the amount the employer paid to the employee charging

This raises a difficult question: what is the regular market price that employees would have to pay under normal circumstances? After all, there are several charging options: a wallbox via a wall outlet, a public charging station, a fast charging station... Each of these solutions usually has a different cost per kWh.

The tax authorities therefore reasoned practically and ruled that you may assume a average cost for 1 kWh of electricity for household customers, all-in and including VAT.

You can find that average cost on the VREG website.  Here, that average cost varies according to consumption categories (low vs. high). You may consider the lowest average cost. This may be an annual or possibly monthly average.

ExampleSandra charges her private car at work. She has to pay €0.15/kWh back to her employer for this. The normal market price for private individuals, based on the VREG website, is €0.21/kWh. Thus, the SG&A amounts to €0.06.

Source : https://www.securex.eu

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