monetary benefit
January 18, 2012 | 30,00 EUR | answered by Andreas Schupp
My employer offers me a company car, which I can also use for private trips.
It is common for such company vehicles to be handled with the 1% rule in our country. Since my place of residence is 75 km away from my workplace, this leads to a very high proportion of the taxable non-cash benefits. For this reason, I have registered a second residence with my in-laws, who live only 11 km away from my workplace. Can I specify this residence for the calculation of the non-cash benefit? What requirements need to be met in order for me to use this second residence for the calculation of the non-cash benefit? If the company car is attributed to my primary residence, can the non-cash benefit be claimed in the tax return? If so, to what extent? Since I work with both China and the USA, I have very irregular working hours, which could explain why I registered the newly introduced second residence, even though we built a new house. Is this a possible option that I can use without running into problems with the tax office? Thank you in advance.
Dear inquirer,
thank you for your inquiry, which I will gladly answer, taking into account your input and the rules of this platform.
Please note that my explanations are based on the situation you have described, and that adding, omitting, changing personal circumstances or the ambiguity of the information provided can affect the tax-correct result. I will not address the social security law aspect in my explanations.
First of all, I strongly advise against the proposal you have suggested.
The journeys between your home and workplace are not covered by the 1% rule. Instead, it covers the private use of the car (e.g. leisure trips) (§ 8 paragraph 2 sentence 1 in conjunction with § 6 paragraph 4 EStG).
For the trips between your home and workplace, an additional 0.03% per month of the domestic list price including special equipment and VAT is taxed for each kilometer of distance traveled on top of that.
As you correctly pointed out, this is a significant amount that you will have to pay in addition every month.
If you pay the 0.03%, you can deduct the commuting allowance each working day in the amount of €0.30 per kilometer between your home and workplace as business expenses.
Alternatively, you have the option to keep a logbook, which could be the cheaper alternative if the vehicle is predominantly or exclusively used for business purposes.
However, a logbook is subject to higher requirements by the tax authorities.
In all your considerations, you should also calculate whether it might be cheaper not to accept the company car offer and instead drive with your private vehicle and bill the business kilometers to your employer.
On the other hand, you won't have to deal with the acquisition costs or the ongoing operating costs of the vehicle, as these costs are covered by the 1% rule.
I hope that my explanations have been helpful to you.
If there are still any uncertainties, please use the option to ask further questions.
Kind regards,
Andreas Schupp
TAX ADVISOR
