The mobility budget is coming (...nevermind)

Update (October 15, 2024): The mobility budget will not be introduced. On October 15, 2024, the German Bundestag decided against it in the debate on the Annual Tax Act. Initially, the draft of the 2024 Annual Tax Act included a tax-advantaged mobility budget aimed at supporting various forms of transportation beyond public transit. We regret that this proposal was dismissed, as such an incentive would have been much-needed for companies and employees in today’s environment. But there’s good news: New mobility options can still be promoted without a mobility budget. Employers can offer tax- and social security-free non-cash benefits of up to 50 euros per month (§ 8 Abs. 1 S. 3 EStG) and flat-rate taxed non-cash benefits of up to 10,000 euros per year (§ 37b Abs. 2 EStG). Additionally, the government has been tasked with developing a comprehensive simplification of tax and social regulations for non-cash benefits—a strong signal toward reducing complexity. So, it’s still an exciting time for mobility benefits!

Have You Heard About the Mobility Budget?
The new budget is on the horizon—but what’s behind it, and why should You consider offering it to Your employees? Let’s take a closer look at the planned Mobility Budget: The Mobility Budget is intended to be a flexible, eco-friendly alternative to traditional company cars. It encourages sustainable commuting and allows employees to use a monthly budget on various forms of transport—whether it’s for public transit, e-bikes, taxis, or car sharing. This gives Your team the freedom to handle work, private, and business travel flexibly and according to their preferences. A key aspect is compliance with tax regulations. For example, public transport tickets are currently tax- and social security-free up to 600 euros annually. Other mobility services like Uber, taxis, or sharing services have so far only been available through the 50 EUR tax-free allowance for non-cash benefits—but this is changing.

According to the draft of the 2024 Annual Tax Act, a dedicated Mobility Budget of up to 2,400 euros per year will be available for employees, free from social contributions and taxed at a flat rate of 25%. Supporting alternative mobility options could benefit both Your company and the environment.

Why Should You Offer a Mobility Budget?
Company cars have long been a reliable perk for offering employees an attractive mobility solution, haven’t they? Fortunately, today’s mobility solutions are expanding—and so are Your employees’ expectations. In a time when flexibility and sustainability are top priorities, rigid solutions like company cars are no longer the first choice.

The Mobility Budget Offers Many Advantages:

• Maximum Flexibility: Employees can freely allocate their budget and use it across various modes of transportation, from public transit and car sharing to taxis and even e-scooters—everything is possible!
• Social Security-Free and Flat-Rate Taxed: As mentioned, Your company can benefit from tax savings and reduce ancillary wage costs. Best of all, the mobility budget provider handles the billing.
• Promote Sustainability: Fewer cars on the road mean lower CO₂ emissions. The Mobility Budget is a great first step toward sustainability for Your company. Bonus: E-bike or bicycle options support Your employees’ health.
• Modern Employer Branding: The Mobility Budget is a fresh and modern benefit that’s perfect for positioning Your company as an attractive employer.

Mobility Budget vs. Company Car—Who Wins?
Admittedly, a company car sounds tempting at first. But let’s be honest: How often is it really used? It often sits idle while we’ve grown accustomed to using various forms of transportation, whether for sustainability or to save time in rush hour. Here, the Mobility Budget steps in, offering a flexible solution tailored to employees’ needs. By allowing a mix of transportation options, it provides an eco-friendlier, more cost-efficient alternative to company cars.

Our Winner: the Mobility Budget.

Our Conclusion
So, what’s the holdup? The Mobility Budget is here and offers an attractive alternative to company cars. It brings numerous benefits to both Your company and Your team. Make Your team happy and boost employee satisfaction with a customized mobility solution that truly excites. The Mobility Budget could be the modern benefit Your company needs to gain an edge in the competition for top talent and make a positive impact on sustainability.

If You want to learn more about how Your company can optimize the Mobility Budget and other modern benefits, check out HelloBonnie. Our flexible Smartcard and app make it easy for Your team to enjoy the advantages of non-cash benefits—tax-free and hassle-free!