Recently, the FPS Finance implemented significant legal adjustments that directly affect companies providing company bicycles or paying bicycle allowances for commuting and business trips.
We summarize the changes in tax legislation for you and provide advice on how to best handle them.
If you make one or more company bicycles available to your employees or managers, it is now necessary to record the value of this benefit on the tax slip of the relevant employee. For the tax year 2024, you use wage code 6841 "inform. value company bicycle." This registration is mandatory but does not automatically mean that this benefit is taxed, as long as the bicycle is mainly used for commuting.
When your employees use their own bicycles for business trips, you can choose to give them a bicycle allowance. It is important to clearly distinguish between allowances for commuting (wage code 420 or 4201) and allowances for business trips (wage code 4203), as they are treated differently for tax purposes and fall under different wage codes.
From this year (tax year 2024), the maximum bicycle allowance you can grant for commuting, without being subject to social security contributions or taxes, has been increased to 0.35 euros/kilometer but with an annual cap of 3,500 euros (indexed for the tax year 2024). Note: bicycle mileage allowances for business trips are not counted towards this cap.
For payroll calculation, a specific wage code must be used, depending on whether it is for commuting or business trips. These new rules result in more detailed administrative processing of bicycle benefits, contributing to greater transparency and better compliance with tax regulations. We recommend carefully implementing these rules to avoid potential tax issues.
Bicycle allowances granted in 2024 for business trips with the employee's or manager's own bicycle and not yet processed with wage code 4203 will need to be corrected and transferred to this wage code, starting from the January 2024 payroll period.
If one or more of your employees or managers are in this situation, you can perform the correction yourself during the next payroll processing. This is done by first posting the amount negatively under wage code 420 or 4201 and then positively under wage code 4203. If you need support during this process, it is advisable to contact your file manager as soon as possible.
Ensure this information is provided before January 15 of the following year to ensure it is processed correctly.
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