The raised cap on the French fuel allowance (“prime carburant”) applies to the whole of 2026. The official social security bulletin (“Bulletin officiel de la sécurité sociale”, Boss) made this clear in a statement of 30 October 2026: employers can pay up to €1,000 per employee free of social security contributions, with no pro-rating by the date the new rules took effect. Amounts already paid since January count towards the cap.
What applies until 31 December 2026
Two decrees of 20 October 2026 (décrets n° 2026-973 and n° 2026-974, published in the Journal officiel on 21 October) now set the social security treatment of employer contributions to commuting costs by regulation. For amounts paid by 31 December 2026:
- the exemption limit rises to €1,000 per employee per year, against €600 normally, of which no more than €300 for fuel. It is a single cap covering the fuel allowance, contributions to charging electric, plug-in hybrid or hydrogen vehicles, and the sustainable mobility allowance (“forfait mobilités durables”)
- the cap is annual: an employer that paid €300 before 1 October can still pay €700 for 2026
- the allowance can go to all employees, whether or not their home or workplace is served by public transport and whatever their working hours, and it can be combined with reimbursement of a public transport pass
Above €1,000, contributions are due only on the excess: on €1,100, that is €100. The other rules still apply. All eligible employees must receive the allowance on the same terms, the amount may vary with the distance between home and workplace, and the employer may limit it to certain costs. Paying it remains optional. It is introduced by collective agreement or, failing that, by a unilateral decision of the employer after consulting the employee representative body (“CSE”), where there is one.
Income tax: nothing is settled yet
For now, the €1,000 cap applies to social security contributions only. For income tax, the allowance remains exempt within the limits of article 81, 19° ter b du CGI: €300 for fuel and €600 for electric charging. In its original version, article 2 of the 2027 finance bill (“projet de loi de finances”) would raise the income tax exemption for amounts received in 2026 to €1,000 for fuel, while charging and the sustainable mobility allowance would stay at €600.
On 4 November, the National Assembly rejected the first part of the finance bill. The government’s original text, which includes this measure, therefore goes to the Senate. On 9 November, the government also announced that it intends to keep the raised cap in 2027 through an amendment to the budget.
For payroll, this means that a €1,000 fuel allowance paid in 2026 is free of social security contributions. Until the finance law is adopted, however, €700 of it is in principle taxable for the employee and subject to withholding tax (“prélèvement à la source”).
What we recommend
If you want to make use of the raised cap, plan the payment with the November or December 2026 payroll: only amounts paid by 31 December count. Record the decision in writing, with the amount, the employees concerned and, where relevant, how it varies with distance. How the part above the current tax limits is treated depends on the finance law. We are following the debate in the Senate and will come back to the subject once the law is passed. Payroll and HR in France
Sources: Boss, statement of 30 October 2026; décrets n° 2026-973 and n° 2026-974 of 20 October 2026 (Journal officiel of 21 October 2026); projet de loi de finances pour 2027 (no. 3210), article 2; LCP, 4 and 9 November 2026. Updated 12 November 2026.