Taxation of company cars
August 8, 2011 | 50,00 EUR | answered by Michael Herrmann
Do I have to use a logbook for the cost cap on company car taxation, and if so, can I simply allocate 100% of all trips as private trips for simplicity?
Facts:
I receive a company car with a gross list price of 49,940 euros. With a distance of 58 km to the workplace, this results in 499 euros (1%) plus 868 euros (0.03% + 58 km), so a total of 1,367 euros monthly as the non-cash benefit.
The company car is leased at an "All in" rate, which includes not only the acquisition costs but also taxes, insurance, fuel, maintenance, etc. The leasing rate is 710 euros/month - so 844.90 euros including VAT monthly - which I consider as the maximum non-cash benefit to be taxed. Can the employer use this amount as the basis for the taxation of the non-cash benefit?
I only use the car in exceptional cases for purely business trips, mostly for private trips from home to work or entirely private. Therefore, my second idea is to forgo a logbook and allocate 100% of the driven kilometers as private, should the cost cap as described above not work.
Thank you!
Dear inquirer,
First of all, thank you very much for your inquiry, which I would like to answer based on the information provided and in the context of your commitment to an initial consultation. The response is based on the description of the situation. Missing or incorrect information about the actual circumstances can affect the legal outcome.
The taxation of the fringe benefit from company car usage is indeed limited to the actual costs of the vehicle. Due to the considerable distance, there is a significant surcharge for trips between home and workplace. So far, you have calculated correctly.
The approach for trips between home and workplace is to be reduced by around 0.30 euros per kilometer and workday (e.g. 0.30 euros x 58 km x 19 days = 330.60 euros). The amount varies depending on the number of workdays. Since the actual costs are still lower than the calculated value here (1,367 euros - 330.60 euros = 1,036.40 euros), the lower actual costs will be used.
The capping of the fringe benefit to the actual costs is intended to prevent more money from being taxed through the lump sum approach than the expenses incurred.
Keeping a mileage log is unnecessary when using the lump sum method, regardless of whether the cost capping applies. In your case, you will benefit from proving the private portion of trips through a mileage log, as this will reduce the taxable benefit by the costs of business trips. If the proportion of business trips is so low that the effort is not worthwhile, you can also forego the mileage log. Without a mileage log, you will end up paying taxes on 100% of the incurred costs.
I hope that these explanations have provided you with a sufficient overview of the situation within the scope of your commitment and this initial consultation, and I remain
Yours sincerely,
Michael Herrmann
Dipl.-Finanzwirt (FH)
Tax consultant
