On June 5, 2024, the federal government approved the draft of the Annual Tax Act 2024. The draft law includes the introduction of flat-rate taxation of mobility budgets. This measure aims to facilitate mobility budgets and the use of new mobility forms, such as sharing offers. NAVIT CEO and Co-Founder René Braun even sees the mobility budget as a potential competitor to the company car. Here’s everything you need to know about the new flat taxation of the mobility budget.
Employers are to be given more opportunities to promote the mobility of their employees in a tax-advantaged way, beyond company cars, company bicycles, and job tickets. The federal government plans to introduce a special tax benefit for the mobility budget.
On June 5, the federal cabinet approved the draft for the Annual Tax Act 2024, which includes the introduction of flat-rate taxation of mobility budgets (Press Release from the Federal Ministry of Finance). Federal Finance Minister Christian Lindner mentioned the mobility budget as the first point in his statement (see minute 0:40 in the video). The Handelsblatt had already reported on these plans in early April.
Press conference with German Minister of Finance Christian Lindner on the Annual Tax Act 2024 and on new tax reliefs on 5 June 2024. Source: www.bundesfinanzministerium.de
In the future, employers will be able to tax mobility budgets up to a cost limit of 2,400 euros per year and per employee at a flat rate of 25%, provided they grant the mobility budget in addition to the wages owed anyway, for example, in the form of a non-cash benefit or allowance.
The state-sponsored mobility budget is intended to work as follows: The employer finances the use of e-scooters, e-bikes, car sharing, and other sharing offers. The associated monetary benefit for employees will be taxed at a flat rate of 25% up to 2,400 euros per year. This tax benefit will only apply if employers grant the mobility budget in addition to regular salary.
"This tax reform not only promotes sustainable mobility but also creates an incentive to compete with company cars and their associated tax privileges." (René Braun, NAVIT CEO and Co-Founder)
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So far, there have been similar tax benefits for the use of company cars, company bicycles, or job tickets for public transportation, but not for new mobility. The mobility budget is intended to expand these opportunities to new mobility forms such as sharing offers. The draft law states: "Employers will thus have the opportunity to provide their employees with a diverse mobility offer and to purposefully complement existing offers."
Previously: Different taxation depending on the mode of transport and implementationNow: Flat-rate taxation of mobility budgets (§ 40 EStG)Taxation depending on the implementation model of the mobility budget: Prepaid card: 50 euros tax-free non-cash benefit (§8 Para. 2 Sentence 1 EStG) or 30% flat-rate taxation (§37b EStG) Receipt capture & reimbursement: Individual gross taxation, except tax-free public transport (§3 No. 15 EStG)Employers can tax mobility budgets in the form of a non-cash benefit or allowance up to a cost limit of 2,400 euros per year and per employee at a flat rate of 25%.New mobility forms, such as sharing offers or ride-hailing, are not tax-advantaged.New mobility forms are considered, enabling less bureaucratic taxation.
Currently, if employers want to financially promote new mobility forms such as car sharing and e-scooters, they have a tax exemption limit of 50 euros available through the so-called non-cash benefit. Beyond that, there is a flat-rate taxation of 30% with a maximum limit of 10,000 euros per year. This tax regulation can be used for various employee offers. The currently planned tax benefits are specifically intended to promote employee mobility and to particularly "expand the already existing incentives to promote the most climate-compatible mobility possible."
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The mobility budget is a way for companies to provide their employees with a monthly allowance for mobility, which they can use for commuting to work or privately. This allowance can enable employees to use climate-friendly mobility forms, including public transportation, sharing offers, or bicycle subscriptions.
Employers can tax mobility budgets up to 2,400 euros per year and per employee at a flat rate of 25%, provided they are granted in addition to the regular salary.
The mobility budget is taxed at a flat rate of 25%, provided it is granted as a non-cash benefit or allowance in addition to the regular salary.
Companies can more easily and flexibly introduce mobility budgets as a benefit, which is especially advantageous for SMEs. It also enables companies to better promote sustainable mobility and create alternatives to company cars.
Taxation becomes more uniform and simpler. New mobility forms such as sharing offers are included, and flat-rate taxation reduces bureaucratic effort.
No, existing tax-free or tax-advantaged mobility offers such as job tickets and company bicycles remain unaffected.
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