Leasing vehicle for employees
November 18, 2020 | 40,00 EUR | answered by Steuerberater Knut Christiansen
Good day,
One of our employees has obtained a leasing vehicle through us. The employee pays the monthly leasing rate, as well as the taxes and insurance contributions, while fuel is purchased at their own expense. The leasing rate is transferred to us by the employee on a monthly basis.
Our tax consultant believes that the 1% rule must be applied to her. This means that we calculate the amount in gross and then deduct the amount in net. As a result, she incurs additional costs for social security and taxes, and we as the employer do as well.
In essence, she is paying the leasing rate herself and has even less net income due to the additional gross amount.
We believe this is not fair.
We would appreciate your response.
Kind regards.
Good day and thank you for using frag-einen.com!
I would like to answer your question as part of an initial consultation.
It is initially correct that for the vehicle that is also provided to the employee for private use, a private use must be considered as a taxable benefit. If no logbook is kept, the determination of the private use portion must be done using the flat rate 1% method.
However, if the employee makes contributions to the vehicle (e.g. lease payments, fuel costs, insurance, taxes), the taxable benefit is reduced by these contribution amounts. It may even result in the taxable benefit being reduced to 0 euros, but it will not be negative (if the contribution exceeds the taxable benefit).
By reducing the taxable benefit through contributions, not only does the income tax decrease, but also the social security contributions.
Therefore, the tax advisor is not correct in claiming that the full taxable benefit (1% of the gross list price per month) must still be considered.
I hope this answers your question, otherwise feel free to ask further questions at no cost.
I would like to point out that this forum cannot replace a comprehensive and personalized tax consultation, but is primarily intended to provide an initial tax assessment. By adding or omitting relevant information, the legal assessment of your issue could differ.
Best regards
Knut Christiansen
Tax advisor
