Bike Allowance in Belgium: Everything You Need to Know in 2024

The bike allowance is becoming increasingly popular in Belgium. More employees are opting for bicycles as their mode of transportation, and employers encourage this through a tax-free commuting allowance. Since 2023, the bike allowance has even become mandatory for certain employees. This article answers all your questions about the mandatory cycling allowance, its impact on taxes, possibilities for employees with a company car, and how to calculate the allowance.

Is a bike allowance mandatory in Belgium?

Since May 1, 2023, the bike allowance has been legally required for employees in the private sector who regularly commute by bike. This rule applies to employees who cycle to work at least one day a week. While this allowance is not mandatory for the public sector, many government services voluntarily offer it.

The mandate requires employers to pay 28 cents per kilometer (2024), with a tax-free maximum amount in 2024 of €0.35 per kilometer. However, this tax-free status applies only if employees declare their professional expenses as a flat-rate deduction; if actual expenses are claimed, the allowance becomes taxable. The maximum tax-free distance is 3,500 km per year. Additionally, there is a single-journey maximum distance of 20 km eligible for the allowance.

What defines a “bicycle”?

Under Belgian law, the term "bicycle" covers a range of vehicles. This includes regular bicycles, electric bicycles, and speed pedelecs, as defined in the general police regulations.

When does the new bike allowance regulation apply?

The new regulation CLA164 only applies if no sector-specific or company-level collective labor agreement (CLA) exists with specific agreements regarding the bike allowance. In cases where a specific CLA is in place, its conditions and amounts prevail, even if the rates are lower. From May 1, 2023, employees who cycle regularly are entitled to the allowance, regardless of the sector or company in which they work.

For companies that had not implemented a cycling allowance by May 1, 2023, CLA164 sets the guidelines, with a maximum rate of €0.28 per kilometer (2024), up to 40 km per day per employee, tax-free. Companies covered by CAO164 can also apply for a tax credit.

Can you receive a bike allowance if you also have a company car?

Yes, it’s possible to receive a bike allowance even if you have a company car. However, you must use the bicycle on the days you claim the allowance. For example, if you cycle to work twice a week and use the company car on other days, you will only receive the allowance for the days you cycle.

To prevent fraud, many employers require employees to record their bike trips. The easiest way to do that is by using the Commute Planner in Mbrella.

How does the bike allowance affect your tax return?

In Belgium, the bike allowance is a social benefit, exempt from taxes and social contributions as long as the amount does not exceed the legal maximum (€0.35 per kilometer in 2024), and is applied only if flat-rate expenses are declared. If actual expenses are deducted, this tax-free status no longer applies. For employees, this means that exceeding 3,500 kilometers or taking a higher allowance could result in taxable income. Companies should also consult their respective joint committee to ensure compliance with any stricter regulations.

What are the minimum and maximum bike allowances?

The maximum tax-free bike allowance in 2024 is €0.35 per kilometer. However, there is no legally defined minimum allowance. Employers must follow their joint committee, but most companies prefer to offer the tax-free maximum to encourage cycling. Companies that had not previously offered a cycling allowance by May 1, 2023, must follow CLA164’s guidance, with a tax-free allowance capped at €0.28 per kilometer and a maximum of 40 km per day.

Is there a minimal distance for the bike allowance?

No, there is no legal minimum distance for the biking allowance. This means employees are entitled to the allowance regardless of how small the distance they travel. However, companies can set a minimum distance in their mobility policy. Always check your employer's policy to understand what applies.

Tax credits for higher bike allowances

The government has introduced a tax credit to further encourage cycling. Employers who voluntarily increase their cycling allowance can offset the cost increase with a tax credit, lowering their taxable income. The tax credit is calculated as the difference between the increased allowance and the rate as of June 1, 2023 (referred to as the "reference allowance") and applies up to an additional €0.05 per kilometer.

Example: A company in joint committee 200 paid its employees a cycling allowance of €0.20 per kilometer on June 1, 2023. On February 1, 2024, the company raises this allowance by €0.05 to €0.25 per kilometer. If employees cycle 10,000 km in total from February to December 2024, the tax credit is calculated as follows: (0.25 - 0.20) x 10,000 = €500. 

This tax credit applies until the end of 2026, provided certain conditions are met: the increase is voluntary, fully paid by the employer, permanent, and is higher than €0.18 per kilometer.

CAO164-specific tax credit

Under CAO164, companies that implemented a bike allowance after May 1, 2023, can also apply for a tax credit calculated as the difference between the new bike allowance and the zero-reference rate from July 1, 2022.

Example: A company in Joint Committee 333 did not provide a cycling allowance on July 1, 2022. Starting May 1, 2023, the company introduces a cbike allowance of €0.27 per kilometer. In 2024, this allowance increases to €0.28. If employees cycle a total of 7,500 km between May and December 2023 and 17,500 km in 2024, the tax credit calculation is as follows:
(0.27 - 0) x 7,500 + (0.28 - 0) x 17,500 = €6,925.

The company bears the costs of this bike allowance, and companies under CAO164 may apply for both this specific tax credit and the general credit if applicable.

How do you calculate the bike allowance?

Calculating your bike allowance is straightforward:

1. Determine your daily cycling distance.
2. Multiply by the rate per kilometer (commonly €0.35 in 2024).

Example calculation:
If you cycle 10 km round trip daily, the calculation is:
10 km x €0.35 = €3.50 per day.

Then multiply by the number of days you cycle per month. If you cycle 15 days, the monthly allowance would be:
15 days x €3.50 = €52.50.

But forget about calculating the allowance manually. With Mbrella’s Commute Planner, the allowances are calculated and paid out through payroll automatically.

What are the benefits of the cycling allowance?

A cycling allowance offers multiple advantages. It promotes healthier, eco-friendly commuting, reduces traffic congestion, and alleviates parking challenges. For employees, it provides a tax-free benefit, and for employers, it contributes to a sustainable mobility policy that strengthens brand image and employee satisfaction.