Reimbursing home charging of company cars in Luxembourg: no official flat rate, real cost instead

Luxembourg has no official flat rate per kWh for the electricity an employee charges into a company car at home. In practice, under the Grand-Ducal Regulation on benefits in kind, that electricity is a running cost of the car covered by the flat-rate benefit in kind, provided the employer reimburses the real cost of the kWh actually charged.

This article is for HR, payroll and finance teams. It sets out the rule in one sentence, the texts behind it, the four common reimbursement methods from riskiest to safest, a 100-vehicle worked example, the case of cross-border workers and a clause for your car policy. That is exactly what Voltaback automates for more than 200 client companies: measured kWh, valued at the real contract price of each driver.

Why the question arises at all

An electric company car is largely charged where it spends the night: at the employee's home. The electricity then runs through the private meter and lands on the private electricity bill. Without reimbursement, the employee pays part of the company car's running costs; with reimbursement, the question is whether it counts as extra salary for tax purposes.

In Luxembourg the topic is younger than the cars. According to the Arval 2026 barometer, 86 % of companies have or plan charging on site, but only 21 % use or plan home charging. At the same time, 70 % cite charging difficulties as an obstacle to electrification. Reimbursing home charging is one of the levers many companies have not pulled yet.

Source: Paperjam, Arval 2026 barometer.

The rule in one sentence

When the employer reimburses the real cost of the kWh charged into the company car, this stays, in practice, within the flat-rate benefit in kind; any amount above that real cost becomes taxable salary.

This reading is well founded, but it is not written anywhere in so many words. No law, Grand-Ducal Regulation or circular of the direct tax administration (Administration des contributions directes, ACD) deals specifically with home charging of a company car. Get the reading confirmed in writing by your fiduciary or tax adviser before you put it into your policy. We expressly do not present it as an official ACD position.

The texts this reading rests on

The legal basis is the amended Grand-Ducal Regulation of 23 December 2016 implementing article 104 of the income tax law (L.I.R.). Four provisions are decisive:

• Article 3 a): under the logbook method, the benefit equals private kilometres multiplied by the car's cost per kilometre as established by the employer. That cost covers all car costs, energy included.
• Article 3 b): this method can be replaced by a flat-rate system based on the catalogue price. The flat rate therefore stands in for the full cost of the car.
• Article 4 b): if the employee contributes to variable costs such as fuel, maintenance or repairs, that contribution may not be deducted from the flat-rate benefit. That only makes sense if those costs are presumed to be borne by the employer and covered by the flat rate.
• Articles 2 and 7: if the employer pays costs of the employee's private car, that is salary. If the car replaces part of the cash salary (salary conversion), the flat-rate method does not apply.

Article 104 L.I.R. also sets the principle: an amount above an actual expense is no longer a reimbursement but remuneration. Sources: Grand-Ducal Regulation of 23/12/2016, coordinated text (Chamber of Commerce), Guichet.lu, company cars for employees.

What this rule does not cover

The reading applies to a clearly defined case: a company car whose private use is valued at the flat rate, and a reimbursement equal to the real cost. Four situations fall outside it:

• The employee's private car: if the employer pays its electricity, that is salary (article 2). For business trips in a private car there is instead the tax-free mileage allowance of up to €0.30 per km.
• Salary conversion: if the company car replaces part of the cash salary, the costs taken on by the employer are taxed at their actual value (article 7).
• Logbook method: if the benefit is valued through private kilometres and cost per kilometre, the reimbursed electricity belongs in the car's cost per kilometre.
• Amounts above real cost: any top-up, including a "comfort bonus", is salary.

Plug-in hybrids follow the same logic as battery electric cars: reimbursed electricity is a running cost of the car. Their benefit in kind is higher, though (2 % for registrations from 2025).

What practitioners say

Luxembourg practitioners reach the same conclusion. The HR legal database Pixie writes that the flat rate already includes all costs such as fuel, maintenance and insurance, with no fuel supplement. Fiduciaire LPG describes a battery electric car where the employer bears almost all costs, electricity included, and only the 0.5 % benefit is taxable. Sources: Pixie, fuel costs and company cars, Fiduciaire LPG, company car benefit in kind.

How the benefit itself is calculated (0.5 %, 0.6 % or more, depending on the car and contract date) is explained in our article on the benefit in kind of electric company cars.

Four reimbursement methods, from riskiest to safest

Companies in Luxembourg reimburse charging in very different ways. These four methods are the ones we see most:

Methods 1 and 2 are simple but prove nothing. If the amount exceeds real cost, the difference is salary. If it falls short, the driver pays for the company car's electricity out of pocket, which leads to arguments. We go into detail in our article on expense claims for EV charging.

Method 3 is a step forward because kWh are recorded. An average price is only right for the driver who pays exactly that price, though. In Luxembourg every household has its own price: supplier, single or dual rate, dynamic tariff, reference power.

Only method 4 reimburses exactly what the employee paid for the company car, no more and no less. It is the method Voltaback applies.

What a charged kWh really costs in Luxembourg

To reimburse at real cost, you need the right price. That is not the average bill price (about €0.26 per kWh including fixed charges) but the marginal price: what each extra kWh flowing into the car costs.

That marginal price is made up of the energy price, the Creos volumetric network fee (€0.0510 per kWh excluding VAT in 2026) and 8 % VAT. On a major supplier's dual-rate offer this gives about €0.19 per kWh at night and €0.20 during the day. Night electricity is only slightly cheaper.

Watch the reference power. Since 2025 the network fee depends on a reference power assigned by Creos. Each kWh drawn above it carries a surcharge of €0.0765 excluding VAT, so about €0.27 per kWh at night. An 11 kW wallbox quickly exceeds the reference power. Source: Switchr, Creos network tariffs 2026.

That is one more reason to measure rather than use a flat amount: two neighbours with the same car can pay different real prices. More in our article on the price per kWh of charging.

Worked example per driver: how the monthly amount is built

The monthly amount comes from two figures that differ for every driver. Three drivers with the same model each charge 240 kWh a month at home:

The gap between the first and the third driver is about €12 a month, almost €150 a year, for identical consumption. A single amount would be wrong for at least one of the three. Whether the surcharge above the reference power is reimbursed is for your car policy to decide: it is a real cost, but slower charging avoids it.

Smarty, dynamic tariffs, solar: why every household has its own price

More than 98 % of electricity meters in Luxembourg are Smarty smart meters. They have made new tariff forms possible: dual rates with a cheaper night window, dynamic tariffs whose price follows the hourly wholesale market of the shared Germany-Luxembourg price zone, and the reference power with its surcharge. Add households with their own solar panels.

For reimbursement this means two employees in the same town can pay different prices for the same kWh, and one employee's price can change from month to month. A fixed rate cannot reflect that variety. Each driver's contract price, and for a dynamic tariff the actual price of the charging hours, can.

What a mistake costs: a 100-vehicle worked example

Take a fleet of 100 electric company cars. Each drives 20,000 km a year, 16,000 km of them on electricity charged at home, at 18 kWh per 100 km:

• 16,000 km × 18 kWh / 100 km = 2,880 kWh a year per car, so 240 kWh a month.
• The company pays a single flat amount of €70 a month, so €840 a year.

Suppose 50 drivers live in Luxembourg. The overpayment on them alone is about €14,650 a year. That amount reimburses no expense. It can be treated as salary, with withholding tax, employee and employer social security contributions, and back assessments for earlier years in an audit.

At the same time, the German cross-border workers and some of the Belgian ones help pay for the company car's electricity. The flat amount therefore combines a tax risk with a sense of unfairness.

To estimate these gaps for your own fleet, use our home charging solutions simulator.

Luxembourg has no official per-kWh flat rate

That is the key difference with some neighbouring countries. In Luxembourg, no regulator publishes a quarterly rate and the ACD publishes no rate for home charging. The only official flat rates concern the car itself (0.5 %, 0.6 % or 2 % of the catalogue price per month) and the mileage allowance for business trips in a private car.

The practical consequence: no official figure protects a fixed amount. That is less of a drawback than it seems. An official rate would be an average, too high or too low for most drivers. Without one, the only option left is the method that is the most accurate anyway. The only amount you can justify is the real cost. Measuring kWh and using each employee's real contract price become your best protection if the ACD asks questions.

Outlook: what may change in 2027

The framework around reimbursement is moving. For battery electric cars, the 0.5 % and 0.6 % benefit rates apply to contracts signed by 31 December 2026 and registered by 31 December 2027. A draft Grand-Ducal Regulation approved by the Government Council on 24 July 2026 would extend those rates to the end of 2030 and lower plug-in hybrids up to 50 g CO2 per km to 1 %. Until it is published in the Mémorial, it is a draft.

None of this changes the logic of reimbursing electricity: as long as the benefit is valued at the flat rate, reimbursement at real cost remains the defensible method. A higher rate from 2027 would reduce the EV's advantage, not change the rules for electricity.

Cross-border workers: reimbursement at the residence-country price

About 49 % of employees in Luxembourg are cross-border workers living in Belgium, Germany or France. Their company car is charged at home, under an electricity contract from their country of residence and usually at a higher price than in Luxembourg. Source: IGSS, employment dashboard March 2026.

Three points matter:

• The flat-rate benefit also applies to non-residents employed by a Luxembourg employer. Charging electricity follows the same logic.
• Reimbursement runs through Luxembourg payroll. Luxembourg rules apply to the share taxed in Luxembourg.
• The cross-border worker's contract price is what counts, not a Luxembourg price: about €0.24 at night in Belgium with a dual-rate meter, €0.33 on a single rate, about €0.32 in Germany. A single Luxembourg price under-reimburses these employees.

In practice, proof also comes in different formats. A German bill shows an energy price per kWh and a standing charge; a Belgian one separates day and night prices on dual-rate meters and lists network fees and levies separately. For reimbursement, only the price per kWh with all consumption-based components and VAT counts, not the standing charge. Set in the car policy which document serves as proof, for instance the last annual bill or the supplier's current price sheet.

The tolerance threshold for days worked outside Luxembourg (34 days a year for Belgium, Germany and France) can shift part of the taxation to the country of residence. If it is exceeded, have the treatment of that share checked by your fiduciary.

Social security: what the CCSS looks at

For benefits in kind, social security contributions generally follow the tax base. The flat-rate company car benefit is subject to contributions at the Centre commun de la sécurité sociale (CCSS). A reimbursement at real cost within that flat rate creates, in practice, no additional base.

That is consistent with the tax reading, but here too no specific text covers charging. Put this question on the list for your fiduciary as well. Conversely, any overpayment classified as salary is subject to contributions like any other pay component.

The same applies to cross-border workers as long as they remain insured in Luxembourg. That is the case with telework in the country of residence below 25 % of working time and, under the EU framework agreement on cross-border telework, also between 25 % and under 50 %, with an A1 certificate requested by the employer from the CCSS.

Charging at the office, on the road and with solar power

Home charging is not a company car's only energy source. The other cases each follow a simpler logic.

• Charging at the company site: the employer pays the electricity directly. For a company car this is a running cost, like refuelling with a company card, and needs no reimbursement. For employees' private cars charged on site, Luxembourg has no explicit exemption, unlike bicycles: have the treatment checked before opening charging to private cars.
• Public charging: the simplest route is a company charging card whose invoices go straight to the company. An expense claim with receipts also works, but creates work for drivers and accounting. The Electra charging card is one option for fast charging.
• Solar power from the employee's roof: self-consumed solar power appears on no electricity bill. No text says what price applies. A defensible approach is to reimburse grid electricity at the contract price and settle the solar share separately, for instance at the price the employee would have received for electricity fed into the grid. Agree the method with your fiduciary and write it into the car policy.

The charger at the employee's home: obligation, cost, ownership

A Luxembourg employer has no legal obligation to install a charger at the employee's home. Many do anyway, because otherwise the company car is charged on a household socket or in public. Source: Pixie, employer's obligation to install a home charger.

Three models have become established in practice:

No official Luxembourg text deals with the tax treatment of the charger itself. If it stays the employer's property and serves the company car, there are good arguments for treating it as a work tool. If ownership passes to the employee, its value is in principle a benefit. Both points belong on the list for your fiduciary. Important for reimbursement: a charger is not a prerequisite for measuring the kWh charged.

The documents to keep

A reimbursement must be able to show what it reimburses. Keep, per driver and per month:

• the kWh charged into the company car, separate from other household consumption;
• the kWh price from the employee's electricity contract (bill or price sheet, single, dual or dynamic rate);
• the period and the car (registration number);
• the calculation kWh × price and the matching payroll line.

Accounting records must be kept for 10 years in Luxembourg. File the monthly reports with payroll records, not in an inbox. Source: Guichet.lu, accounting obligations.

For measurement, Voltaback relies on the home's MID-certified meter, not on a standalone cable meter. Charging data are read directly from the connected car (more than 48 brands), with no box and no connected wallbox, including for cross-border workers. Our measurement is audited by an independent third party, with a relative error of 1.22 %. For homes without a smart meter, read our article on charging without a smart meter.

Reimbursement solutions on the market: what to check

If you do not want to organise reimbursement yourself, several approaches exist in Luxembourg. Leasing companies sometimes reimburse home charging themselves and re-invoice the employer, often at an average rate per country. Energy suppliers and installers offer packages of charger plus billing, often tied to their hardware. Software solutions read charging data from the car.

Five questions help you compare:

1. Which price is applied: each driver's contract price or an average?
2. How are cross-border workers handled: at the price of their country of residence?
3. Is hardware needed: a specific wallbox, a sub-meter, a box in the car?
4. What data does the employer receive: only kWh and amounts, or location data too?
5. How does the amount reach payroll: as a file for your payroll software or your fiduciary?

The monthly process in 5 steps

Reimbursing at real cost is no extra work once the process is set:

1. Connect the car: the driver connects the company car once in the app, so that home charging sessions are recorded.
2. Store the price: the driver uploads a price sheet or electricity bill, and again after any change of supplier or tariff.
3. Month-end close: the kWh charged at home are valued at the contract price; sessions elsewhere are excluded.
4. Approval: the fleet manager or HR checks anomalies, such as an unusually high month.
5. Payroll: the amount is paid as a reimbursement through Luxembourg payroll, and the monthly report is filed as proof.

Who does what?

What your car policy should say

A clear policy prevents most questions. Here is a suggested wording to adapt with your fiduciary:

"The company reimburses the employee for the real cost of the electricity charged at home into the company car provided. The amount equals the kWh measured for that car multiplied by the kWh price in the employee's electricity contract, including for employees living outside Luxembourg. Reimbursement is paid monthly through payroll on the basis of a record kept by the company. No flat amount above real cost is paid."

Add practical rules: what happens after a change of supplier, how public charging is handled (a company charging card is better than an expense claim), and who the contact person is. Drivers will find what they need in our driver's guide to charging a company car at home. For the wider rollout across a fleet, see our guide to managing and reimbursing home charging.

Common mistakes

• Copying a flat rate "as in Germany" or "as in Belgium": those rates have no legal basis in Luxembourg.
• Applying one Luxembourg price to everyone, including cross-border workers with more expensive electricity.
• Using the average bill price instead of the marginal price of an extra kWh charged.
• Paying the reimbursement as expenses outside payroll, with no monthly record.
• Not separating household consumption: only the kWh that went into the company car are reimbursed.
• Forgetting tariff changes: a new employee contract changes the price from the month of the change.

What the employee gains

For the driver, reimbursement at real cost is above all a matter of fairness: they do not help pay for the company car's electricity, and they do not receive an amount that could later be taxed as salary. Cross-border workers, whose electricity is markedly more expensive in Belgium or Germany, gain the most. The effort is small: connect the car once, upload the price sheet once, then reimbursement runs every month through payroll.

Voltaback: home charging reimbursed at real cost, with no hardware

Voltaback measures the kWh charged at home into each company car, values them at each driver's real contract price, resident or cross-border, and delivers a monthly export ready to import into your payroll software. 100 % software, no box and no required wallbox, ISO 27001 certified since 2 December 2025 and GDPR compliant: the company never receives drivers' location data.

Discover our home charging reimbursement solution or talk to our team to calculate the switch to real cost for your fleet.