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Tax-free travel allowance will increase as of 1 January 2023

The tax-free travel allowance will increase from 19 cents to 21 cents as of 1 January 2023.

As of January 1, the minimum tax-free travel allowance will be increased to 21 cents per kilometre. This is stated in the recently published Spring Memorandum[1] from 2022. The planned increase was originally on the agenda for 2024, but has been brought forward at the request of the House of Representatives. Most likely, the tax-free kilometer allowance will increase to 23 cents per kilometer in 2024. The cabinet has yet to decide on the exact amounts. This will be discussed in detail on the next Budget Day.

First change in 17 years

The tax-free travel allowance has been 19 cents per kilometer for 17 years, despite the fact that there has been a call for an increase for years. While the cost of use kept rising, the travel allowance was not increased. The travel allowance has therefore no longer been cost-effective for years. In March, the House of Representatives already asked for an increase in the maximum tax-free allowance due to the high energy and fuel prices. As a result, the travel costs for people who go to work by car have also risen sharply.

What does this mean for employers?

A higher amount per kilometer may be reimbursed tax-free to the staff. Whether you will actually pay more depends on the agreements between you and your employees. As an employer, you may of course grant a higher travel allowance if this is fiscally permitted. The excess then constitutes taxable wages.

Have all your employees automatically declare travel expenses and home working days

Via the Fynch Mobility App, all journeys for any form of mobility (car, public transport, bicycle, walking, etc.) are automatically registered. Employees can then indicate in the App whether the journey was commuting, business or private. At the end of each month, the employee can (manually or automatically) generate an export for the declaration. Fynch Mobility can also build an automatic link with the employer’s HR system to make the process even easier. With Fynch Mobility you always have your travel allowance in order.

 

[1] Voorjaarsnota 2022

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