The adjustments to the mobility budget, which have been in force since 1 January 2022, was to make it more attractive. These are now bearing fruit. 

The system, which came into force in 2019 got off to a slow start, but since then more and more companies and their employees are showing particular interest in the mobility budget.

Let us remind you that employees who join this legal scheme give up their company car to create a mobility budget that they can spend in one of three pillars:

  • Pillar 1: a more environmentally friendly company car;
  • Pillar 2: sustainable means of transport and/or intervention in accommodation costs;
  • Pillar 3: a payout once a year in cash of the unspent balance in the mobility budget. This sum is subject to a special social security levy (38.07%), but is tax-free.

The longer the system is in place, the better known it obviously becomes. But in addition, we see some other factors that have made the system grow in popularity.


There may be very few positive things to say about the corona pandemic, yet it has indirectly encouraged the use of a mobility budget.

This was manifested by the many people who (re)discovered cycling during the lockdowns and continued to do so after returning to the office.

The pandemic forced people to work from home in almost all companies, evolving into a hybrid way of working. This situation caused employees to use their (company) car less frequently and consider alternative mobility solutions.

Greening the car fleet

Following Federal Minister of Finance Van Peteghem's tax reforms to bring about the “greening” of company car fleets, companies have become fully committed to electrifying their fleets.

In turn, this fits perfectly into pillar 1: the environmentally friendly car choice.

Employees, who enter the mobility budget and still want a car, can opt for a cheaper car than the one they are normally entitled to and then continue to spend their remaining mobility budget in a parafiscal-friendly way on sustainable alternative mobility solutions (pillar 2) and/or an advantageous cash payout (pillar 3).

Employees, who prefer not to opt for an electric car because they cannot install a charging station at home, are more likely to give up their company car and choose the mobility budget.

A new generation

Finally, we see that the youngest generation of employees, also known as Generation Z (born between 1995 and 2010), have very different expectations and needs compared to other generations.

Not only is the atmosphere at work important to them, but flexibility and work-life balance (read: a good commute) are also high on their wish list.

As a result, they do not automatically opt for a car, and companies are often challenged with questions about an attractive, alternative (mobility) offer.

The figures speak for themselves

For example, assuming a Total Cost of Ownership (TCO) is EUR 800/month for the return of a company car, the employee receives a mobility budget of EUR 9,600 on an annual basis.

Several scenarios are then possible.

Opting for a pillar 1 car

When the employer provides a pillar 1 choice, the employee can opt for a cheaper, environmentally friendly car.

  • EUR 9,600
    • EUR 7,800 (eco-friendly car with TCO 650 EUR/m)
    • EUR 1,000 (purchase of private bicycle via pillar 2)

Balance cash payout pillar 3 = 800 - 38.07% social security tax = EUR 495.44 net

In this case, the employee will have a company car, supplemented by a private bicycle fully financed via the mobility budget and a net payout of EUR 495.44. 

Choices in pillar 2

The choices in pillar 2 are completely exempt from social security contributions and taxes. Consequently, the employee can optimize the mobility budget in full.

If the employee were to use his entire mobility budget of EUR 9,600 in pillar 2 (e.g. public transport, a bicycle, repayment of rent or mortgage repayments provided he meets the conditions, etc.), this amounts to EUR 9,600 net for the employee.

Full mobility budget in cash at the end of the year

If the employee does not opt for pillar 1 and/or 2, the unused budget will always be paid out at the end of the calendar year in the form of a cash premium (pillar 3).

The remaining budget is only subject to a special social security tax of 38.07% and exempt from any other taxes.

EUR 9,400 - 38.07% = EUR 5,821.42 net

Starting with a mobility budget

Is your company considering starting with a mobility budget? If so, you can largely determine yourself how the mobility budget will be implemented: as an employer, you can decide which elements you offer in the second pillar and how you determine the mobility budget.

At KPMG, we can guide you through the strategic decisions, the tax, legal & accounting questions and points to examine when implementing a mobility budget. We also offer an innovative tool to easily manage the budget and register choices made by your employees.

Finally, the mobility budget can be perfectly combined with a cafeteria plan or flexible car policy, thus offering all your employees – including those who may not be entitled to a company car – an attractive salary package.