CO2 contribution and benefit in kind in 2021

CO2 contribution

The employer has to pay a solidarity contribution for company cars that can also be used for private purposes.  This so-called CO2 contribution is based on the car's CO2 emissions and energy label.  A minimum amount always applies.

The CO2 contribution is calculated as follows:

((CO2 emissions x €9) – 768 (petrol) or 600 (diesel) or 990 (LPG)/12 x index coefficient

The index coefficient and the minimum amount are indexed annually.The minimum amount is payable for zero-emission cars.

The values for 2022 are already known.  For 2022, the index coefficient is 1.3525 and the minimum CO2 contribution is €28.17 per month.

Benefit in kind

Providing a company car to an employee who can also use the car for private purposes is considered as a benefit in kind and therefore gives rise to tax at the employee's expense.

The benefit in kind is calculated as follows:

list value x CO2 coefficient x 6/7 x age percentage

A minimum amount always applies.  The CO2 reference values and minimum benefit in kind are reviewed annually. The CO2 reference values for 2022 are 75 g/km for diesel cars and 91 g/km for gasoline cars, CNG and LPG. The minimum benefit in kind for 2022 is €1,400/year.

  • List value

The list value on which the calculation is based is the list price of the car and all its options, excluding any discounts and including the actual VAT paid.

  • CO2 coefficient

    The formula for the CO2 coefficient is as follows:

5,5 + ((CO2-emission of the vehicle - CO2-reference)x0,1)%

The CO2 coefficient is the difference between the reference emission levels the legislator provides annually and the CO2 emissions of the car in question.  The basic CO2 coefficient is 5.5% and applies to the reference emission levels.  This reference emission level is adjusted annually based on the average CO2 emissions of newly commissioned cars in the previous year. From 2022 onwards, the CO2 reference values can no longer increase compared to the previous year.

If the emissions exceed the reference emission level, the coefficient is increased by 0.1% per 1g/km up to a maximum of 18%.  If the emissions are lower than the reference emission level, the coefficient is reduced by 0.1% per 1g/km down to a minimum of 4%.  Zero-emission cars are subject to a 4% CO2 coefficient. For 2022, the reference emissions are 75 g/km for diesel cars and 91 g/km for gasoline cars, CNG and LPG. 

  • Age percentage

    The list price can be reduced by 6% from the second year with a maximum of 70%.  In summary:

Year
Decrease in percentages
Year 1
100%
Year 2
94%
Year 3
88%
Year 4
82%
Year 5
76%
Year 6
70% (limit)

Calculation example

Diesel car, catalog value of € 25,000, CO2 emissions 105 g/km, age < 1 year

  • CO2 coefficient : 5.5 + ((105 - 75) x 0.1) % = 8.5%.
  • Benefit of any kind per year : € 25,000 x 8.5% x 6/7 x 100% = € 1,821