Company bicycle

Benefit-in-Kind for Company Bicycles

When an employer provides a bicycle for both private and business use, a fixed taxable benefit-in-kind of 7% of the manufacturer's recommended retail price applies. This means the bicycle remains the employer’s property or is leased by the employer. If the employee independently leases the bicycle but is fully reimbursed by the employer, the same rule applies. Payments made to third parties do not reduce the benefit-in-kind but can be reimbursed tax-free, including electricity costs if an electric bicycle is charged at home.

Employers and employees may agree upon a cafeteria scheme, where an employee exchanges gross salary for the use of a bicycle. This results in a tax advantage, as the employee is taxed only on the fixed rate of 7%. Specific realism requirements apply to cafeteria schemes.
 

Ownership by Employee

It may also occur that the employer gives a bicycle to the employee or reimburses the purchase cost of a privately-owned bicycle. Such provision or reimbursement is taxable as salary. Under the work-related costs scheme (werkkostenregeling), the bicycle may be provided tax-free. A tax-free reimbursement of €0.23 per kilometre (2026) is permitted for commuting and business trips if the employee owns the bicycle.
 

Directors and Entrepreneurs

The same rules apply to directors and major shareholders of a BV, as they are considered employees for tax purposes. The benefit-in-kind valuation of 7% also applies to self-employed entrepreneurs, but can never exceed the actual annual costs of the bicycle.
 

Private or Business Use?

The fixed benefit-in-kind does not apply if the bicycle is only used for business purposes and never taken home. However, commuting automatically implies private use, and evidence through a travel logbook is not permitted. The benefit-in-kind also applies if the bicycle is exclusively used for private purposes or taken home regularly (more than 10%).
 

Definition of a Bicycle

There is no statutory definition of a bicycle. Anything regarded as a bicycle in everyday language, including electric bicycles and speed pedelecs, falls under the scheme. Standard mopeds and light mopeds are excluded. Sporty bicycles such as racing bicycles or mountain bikes may also be used.
 

Recommended Retail Price and Transfer

The recommended retail price announced by the manufacturer serves as the basis for the 7% taxable benefit. Employers may transfer ownership of the bicycle to the employee after five years free of charge (20% depreciation per year). From that moment, the 7% additional taxable benefit no longer applies.
 

VAT Deductibility

The VAT on purchase or lease instalments is deductible up to a maximum of €130, subject to conditions under the BUA. VAT deduction is not permitted if the employee has both a company bicycle and car, or receives significant travel allowances.
 

Employee Contributions

If the employee pays a contribution for private use, there is no taxable benefit. This employee’s contribution is subject to VAT and affects VAT deductibility.
 

Investment Allowance

Company bicycles qualify for the small-scale investment allowance (KIA). Electric cargo bicycles and charging infrastructure can qualify for higher Environmental Investment Allowances (36%-45%) and Random Depreciation schemes (75%). Investments must be reported to the RVO within three months of entering into the obligations.
 

More information

For more information about this subject, you can read the advisory handbook.
 

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