Company Cars and Reference CO2 Emissions for 2025
The Reference CO2 emissions for the income year 2025 have been published
The reference CO2 emissions are a crucial element for the correct calculation of the benefit in kind for company cars. As in previous years, the reference CO2 emissions have decreased once again.
What does this mean in practice? A reduction in the reference CO2 emissions results in an increase in the benefit in kind for the same vehicle.
Reminder: Benefit in Kind for Company Cars
When a company provides a vehicle to its employees, a taxable benefit in kind arises if the employees also use the vehicle for private purposes.
Since 1 January 2012, the benefit in kind for a company car has been calculated as follows:
(Catalogue value of the vehicle × age coefficient) × 6/7 × CO2 percentage
The age of the vehicle affects the catalogue value, with the period since the vehicle's first registration taken into account.
The CO2 percentage is a variable percentage depending on the CO2 emissions of the specific vehicle.
Reference CO2 Emissions for the Calculation of the CO2 Percentage
The CO2 percentage is determined by comparing the CO2 emissions of the relevant vehicle to the reference CO2 emissions. For 2025, the reference CO2 emissions are established as follows:
- 71 g/km for vehicles with a petrol, LPG, or natural gas engines;
- 59 g/km for vehicles with a diesel engines.
The base CO2 percentage is 5.5% for the reference CO2 emissions listed above. If the vehicle’s CO2 emissions are higher or lower than the reference emissions, the base percentage is respectively increased or decreased by 0.1% per gram of CO2.
The CO2 percentage is subject to a minimum of 4% and a maximum of 18%.
Comparison with Previous Years
In 2024, the reference CO2 emissions were
78 g/km for vehicles with a petrol, LPG, or natural gas engines;
65 g/km for diesel vehicles.
In 2023, these values were 82 g/km and 67 g/km, respectively.
Numerical Example
An employee has a company car, a Mercedes-Benz worth EUR 33,695, with a diesel engine and CO2 emissions of 108 g/km.
| 2025 | [ 33.695 EUR x 6/7 ] x [ 5,5 + (109 g/km – 59 g/km) x 0,1 ] /100 |
| 2024 | [ 33.695 EUR x 6/7 ] x [ 5,5 + (109 g/km – 65 g/km) x 0,1 ] /100 |
- 2025 Benefit in Kind: EUR 252.71 per month.
- 2024 Benefit in Kind: EUR 238.27 per month.
This represents an increase of 6% in the benefit in kind compared to the same new diesel vehicle in 2024.
Entry into Force
The new reference CO2 emissions apply to benefit in kind calculations for company cars as from 1 January 2025.
Does the Company Need to Take Action?
The benefit in kind for a company car is automatically calculated correctly, taking into account the new reference CO2 emissions. Therefore, no specific action is required. However, if a company car is replaced during the year, it is important to immediately inform your Payroll Business Partner.
