Up to €1,000 tax-exempt: is the fuel bonus an opportunity for employers?

In France as well, rising fuel prices are creating challenges for employees. While commuting costs were previously, in principle, borne by employees themselves, the French government aims to give employers more flexibility in 2026 to help employees meet these costs.

Therefore, legislation is being prepared that will significantly expand the tax and social security exemption scheme for the so-called prime carburant (fuel bonus). What will this mean in practice for employers? And is it an attractive tool for supporting and retaining employees?

The fuel bonus is not new

The fuel bonus is a voluntary contribution by the employer towards the fuel costs employees incur for commuting between home and work using their private vehicle.

Until recently, the fuel bonus could only be granted to employees who, due to their place of residence, work organisation or travel requirements, could not easily use public transport or were unable to use it at all.

Until now, an exemption from social security contributions and taxes applied up to €300 per employee per year for traditional fuel costs. For electric vehicles, that limit was already €600.

What will change in 2026?

In May 2026, the French government announced that the exempted ceiling would be doubled to €600 per employee. Subsequently, in September 2026, it was announced that the exempt amount would even be increased to €1,000 per employee per year. The aim is to give employers more opportunities to support employees facing rising mobility costs.

In addition, the eligibility conditions for the bonus are being significantly relaxed. For 2026, it would no longer be necessary to verify whether an employee lives or works in an area that is poorly served by public transport. Combining the fuel bonus with a contribution towards public transport costs will also become possible.

The conditions relating to employees who live in a smaller municipality (fewer than 100,000 inhabitants), or who are unable to make adequate use of public transport because of their work organisation or travel requirements within the company, will however remain applicable.

What does this mean in practice for employers?

For employers, this creates an additional opportunity to support employees’ purchasing power without incurring the same cost as a traditional salary increase.

An employee who receives a fuel bonus of €1,000 will retain significantly more net income than if the same budget were allocated to a gross salary increase, provided that the exemption conditions are met.

In addition, employers gain more flexibility:

• You are not required to grant the bonus.
• You determine the amount yourself.
• You can introduce the scheme through a company agreement or, in the absence of such an agreement, through a unilateral decision.
• There is no statutory minimum amount.

The advantages for employers

• Tax-efficient: you can increase employees’ purchasing power without the high costs associated with a traditional salary increase.
• Greater appreciation and retention: employees perceive the bonus as tangible support for their daily commuting costs.
• Flexible system: the bonus remains voluntary, and you determine the amount and conditions within the legal framework.
• Broader target group: thanks to the relaxed conditions, more employees will be able to benefit from the scheme in 2026.

The disadvantages and points of attention

• Additional cost: although the bonus is tax-efficient, it still represents an additional expense for the company.
• Potential perception of unfairness: employees who do not commute by car may view the benefit as less equitable.
• Legislation remains subject to change: the announced €1,000 exemption ceiling still needs to be formally confirmed in legislation.
• Not a structural salary increase: the bonus does not replace a sustainable compensation policy and provides employees with less certainty than a permanent salary increase.

Should you introduce the fuel bonus?

That largely depends on your workforce. The measure is particularly attractive when:

• many employees commute to work by car;
• public transport options are limited;
• you want to support employees’ purchasing power without permanently increasing your payroll costs;
• you are facing labour shortages and want to offer an additional benefit.

For employers, the fuel bonus in 2026 therefore offers a relatively simple and tax-efficient way to provide financial support to employees. Especially with an exemption ceiling of €1,000, it becomes a benefit that is difficult to ignore in a competitive labour market.
At the same time, it remains important to align the measure with your overall remuneration and mobility policy, so that all employees feel they are being treated fairly.