If an employee makes use of his own car for corporate travel, the employer may reimburse the associated costs. The employer may reimburse the costs up to an amount of USD 0.20 per kilometre without being subject to taxes. Please note! Commuting kilometres are not corporate travel and can never be reimbursed without being subject to taxes. Commuting is defined as travel between the home of the employee and the address where the company is established or from which the company operates.
Company passenger car
If an employer provides a passenger car to an employee and the employee also uses this car for private purposes, including for commuting, 15% of the original new value of the car, including general expenditure tax, will be considered to be part of the wages.
- With respect to passenger cars registered in the vehicle registration plate register prior to the effective date of the Belastingwet BES , general expenditure tax also includes turnover tax and import excise duties.
- Commuting kilometres are not corporate kilometres and will be considered private kilometres when answering the question of whether the employee uses the car for private purposes. Commuting is defined as travel between the home of the employee and the address where the company is established or from which the company operates. If the employee takes the passenger car home at the request of the employer, for example, to prevent theft or vandalism, this will be considered a provision of a car and the fiscal addition must take place. If the employee is provided with the car in the course of the year, the addition must be determined pro rata. Imagine that the fiscal addition for the private use of the car amounts to USD 2,400 for the entire year, but the employee may only use the car for private purposes for a period of three months in the course of this year. The private use will be 3/12th part of USD 2,400: USD 800. If the employee must pay a fee to the employer for the use of the car, the paid fee will be deducted from the 15% addition referred to above. Only the costs paid directly to the employee by the employer can be deducted from the addition. If the employee pays more than the mentioned 15% addition, the benefit will be set at nil. Any excess amount will not be deductible as professional costs for income tax purposes.
Imagine that an employee resides abroad for work for an extensive period of time. The employee returns the car key, car papers, and car to the employer. During this period, he will not have access to the car. This means that this period will not be considered when calculating the addition. If the employee travels abroad and does not return the car key, car papers, and car to the employer, the car will remain available to him and the addition must be paid for this period.