Reform of benefits in kind for vehicles: retroactive application to February 1, 2025

After months of anticipation and rumors, the benefits-in-kind reform was officially published in the Journal Officiel on February 27, 2025. Its application is retroactive to February 1, 2025, rather than March 1 as originally planned.
This reform impacts both combustion and electric vehicles, increasing costs for companies and employees alike. Let's decipher these measures and solutions to limit their impact.

Rate increase for internal combustion vehicles

From February 1, 2025, flat-rate tax rates for combustion-powered vehicles will increase. This increase is based on a presumption of increased private use of company vehicles. These changes apply only to vehicles made available after February 1, 2025:

Purchased vehicle > 5 years :
- 10 % of the purchase price (compared with 6 % currently)
- 15 % if fuel included (vs. 9 % today)
Purchased vehicle < 5 years :
- 15 % of the purchase price (compared with 9 % currently)
- 20 % if fuel is included (compared with 12 % today)
Rental car :
- 50 % of annual cost (compared with 30 % at present)
- 67 % if fuel included (vs. 40 % today)

This increase is based on the assumption that private use of vehicles represents 50 to 60 % of time. Later in this article, we'll see how solutions like the one proposed by OPTIMUM can challenge this purely theoretical assumption.

Increased tax relief for electric vehicles

To promote the energy transition, the allowance on benefits in kind for electric vehicles has been increased from 50 % to 70 %. It is capped at 4,582 euros per year and remains valid until December 31, 2027.
This allowance applies only to certified vehicles. Ademe eco-score. As with internal combustion models, this change applies only to vehicles made available from 1 January.^er February 2025

Charging stations and tax exemption

Until 2027installation and use of a workplace charging station remain tax-exempt.
If the employer finances a terminal in the employee's home, an exemption from social security contributions applies up to a limit of :

1,565.20 euros for a terminal over five years old

1043.50 euros for a new terminal

How to optimize your fleet management strategy?

There are several possible strategies for limiting the impact of this reform:

Compare buying and leasing the increase in flat rates means that we need to reconsider the way in which we acquire them.

Favoring eco-certified electric vehicles :
To benefit from the 70 % allowance (up to a maximum of 4,582 Euros per year), companies need to rethink their Car Policy. To do so, they must give preference to vehicles with a good environmental score, from the list drawn up by Ademe.

Anticipating the costs of charging stations and benefit from tax exemptions before 2027.

Compare buying and leasing the increase in flat rates means that we need to reconsider the way in which we acquire them.

Anticipating the costs of charging stations and benefit from tax exemptions before 2027.

Declaring benefits in kind in real terms : pay not on a theoretical estimate, but on actual usage.
The OPTIMUM fleet management solution distinguishes between private and business kilometers!
How do we do it? By creating (editable) templates which, thanks to a telematic box, can be used to allocate kilometers traveled to the "private" or "professional" box.
The OPTIMUM platform lets you run tax simulations to choose the most advantageous option between actual and flat-rate.

Conclusion

This reform will have a major impact on the taxation of company vehicles. Indeed, the increase in charges for internal combustion vehicles and the incentives for electric vehicles will influence fleet managers' decisions. But beyond the choices to be made in terms of Car Policy, there are solutions to limit the impact of the taxation of Benefits in Kind.

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