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Pay Your Workers’ Rent with the Mobility Budget

November 13, 2020
5 min read
Mobility Budget, Tips, Mobility

Got a Company Car fleet ? Switch It Up and Pay Your Workers’ Rent with the Mobility Budget

The mobility budget was put in place to help companies promote greener, more sustainable methods of transportation for employees. No one saw a pandemic coming that would change travel habits so radically. 

More Belgians are working from home than ever before, thanks to the push for teleworking to curb the spread of the coronavirus. This has done wonders for the average Brussels commuter, who spent seven days and six hours a year getting to and from work. And no doubt it’s had a positive effect on the environment. 

Now, with fewer drivers on the road, the real flexibility of the mobility budget shines through. Employers are discovering how they can help employees pay their rent as one of the alternatives to a company car.

Surprised? You're not alone! Despite its obvious advantages, this gem is somehow the mobility budget's best-kept secret. 

What is the mobility budget?

In March 2019, the Belgian government introduced the mobility budget, providing employers and employees with a very attractive and sustainable alternative to a company car.

The mobility budget lets your team members choose from or combine three pillars to spend their company car budget: 

  1. A more eco-friendly company car
  2. Sustainable mobility services and the option to put money toward their rent or mortgage
  3. A cash payout

These can also be combined with any options your company offers.

The amount of this mobility budget is equal to the ‘total cost of ownership’ (TCO) that you, the employer, will incur on a company car, including the monthly lease or rental payments, fuel expenses, and insurance.

You can offer employees a choice in how to spend that budget, at no additional cost to you. This freedom of choice is attractive to top talent, helping you provide an edge with flexibility in salary and compensation packages over competitors.

How can the mobility budget pay employees’ rent?

The mobility budget gives your team members greater flexibility to choose from a broad range of mobility options, as classified into the three pillars mentioned above. Pillar two offers the ability to spend the budget on housing costs.

The employee can elect to spend their mobility budget on pillar one first, and then designate leftover funds to pillars two and three. Or, they may wish to simply apply the TCO to the second pillar and spend all their mobility budget funds on housing costs. 

The mobility budget takes into account that many employees are now working from home because of the COVID-19 pandemic. It gives employers flexibility to apply these conditions even for temporary work-from-home situations.

To qualify for having their housing costs covered by the mobility budget, certain circumstances must apply for the employee:

  • Their home must be within a 5-km radius of their office. This refers to the direct distance, not the distance by road.
  • Their home must be their usual place of work, as determined by how many hours they worked there during the month.
  • The housing costs that can be covered are limited to rent or interest payments on a mortgage loan.
  • The housing costs can only be covered up to 100% even when a couple living together both have access to a mobility budget. (If the worker's home is also used to accommodate people who are not members of the family, the mobility budget can only be used to finance the accommodation costs of his family.)

Employers can choose how to provide funds to employees for pillar two: you can directly allocate the funds to employees, reimburse them for their expenditures, or use some combination of the two.

And we can’t forget the third pillar: Any budget remaining after the above costs are deducted will be paid directly to your employee (after tax, of course), providing even more financial relief. On top of this, the mobility budget grows with employees. If a team member gets a job promotion, they'll receive a higher mobility budget as well.

Requirements to take advantage of the mobility budget

The mobility budget is entirely voluntary for both you and your employees. But there are certain conditions in place to ensure the system doesn’t get abused by anyone. Here’s the fine print:

  1. An employee has benefited or qualified for a company car for an uninterrupted period of three (3) months at the time they request to take up the mobility budget option; AND
  2. Have qualified or benefited from a company car for 12 months out of the 36 preceding their request. There are exceptions for start-ups offering their employees company cars but have not been in existence for a period of 36 months.

You can choose what paperwork you will require from your employees to support their mobility budget allocation, but remember it’s your responsibility to maintain documentation.

Unlock the potential of the mobility budget with Skipr

The mobility budget is a powerful benefit for your team. It’s an opportunity to offer an attractive package for your workers, distinguish yourself from competitors, and implement a green mobility initiative for reaching CO2 targets. Proactively offering these attractive benefits will undoubtedly give you a leg up when it comes to employee attraction and retention!

When employees opt for the mobility budget, you’ll need to have a way for them to easily see and manage their remaining monthly mobility budget at all times — it’s required by law. Luckily, Skipr offers the solution. 
We help organisations implement and manage the mobility budget with our centralised, all-in-one mobility solution. Our end-to-end mobility planning and management platform lets users plan and pay for their mobility solutions — so both employers and employees can manage their mobility budget in a convenient and completely transparent way.

Would you like to know how the Mobility budget could help your company decrease costs, lower CO2 emissions & boost your employee happiness?

Discover our free mobility assessment

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