The taxable benefit in kind of the private use of a company car granted to employees is determined on a lump-sum basis, i.e. a fixed number of privately-driven kilometres multiplied by a coefficient based on the fiscal horsepower of the car. Recently, the Belgian Ruling Commission has published a ruling on the valuation of the benefit in kind resulting from the private use of two company cars granted to employees.

According to the Ruling Commission, referring to Practice Note 241/561.364 of 5 February 2004, the private use of a second company car may be valued according to the minimum kilometres provided by article 18, §3, point 9 of the Royal Decree implementing the Belgian Income Tax Code – i.e. 5.000 km.

However, the Ruling Commission points out that in such case and provided the commuting of the individual (from his home to his fixed place of business) exceeds 25 km (single trip), only the car with the highest fiscal value is deemed to be used for commuting and should be valued by using the 7.500 km parameter. Consequently, the car with the lowest fiscal value is deemed to be solely used for the employee’s private purposes and should be valued using the 5.000 km parameter.

In addition, the Ruling Commission also repeats that any own contribution (including for additional options for the cars) may be deducted from the taxable benefit in kind (during the year the payment has been made).

It is at this stage unclear if and to what extent the upcoming changes to the fiscal valuation of company cars would affect the above.