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If you run a business in the Netherlands and you or your employee(s) use a car on business trips, in some cases you may provide an allowance for the costs or offset the costs against tax. What rules apply depends on your situation. In general, the Dutch Tax and Customs Administration (Belastingdienst) distinguishes between driving a private or rental car, a company car or a lease car.
Driving your own car or a rental car
You may offset €0.19 per kilometre against your revenue for business trips made in your own car or a rental car. You may not deduct the VAT (BTW) on the purchase price of the car, but you may deduct the VAT on repair and maintenance costs on the condition that you take account of private use of your car.
Driving a company car
Your car is part of your business assets and all motoring expenses are chargeable to your business. You may offset the costs against your revenue on condition that you take account of private use of the car. If you buy the car especially for your business, you may deduct the VAT on the purchase price. If you already owned the car before you started using it for your business, you may not deduct the VAT on the purchase price. You may deduct the VAT on the repair and maintenance costs, on condition that you take account of private use.
Driving a leased car
A leased car is not part of your business assets, but the costs are chargeable to your business. You may offset the costs against your revenue, on condition that you take account of private use of the car. You may also deduct the VAT charged to you by the leasing company.
Employees driving their own car
You may pay your employee an allowance free of tax and social security contributions of no more than €0.19 per kilometre. You may also pay your employee this allowance for commuter travel. You may not deduct the VAT on the purchase price or repair costs of this car.
Employees driving a company car
If your employee drives more than 500 kilometres per year for private purposes, this private use will be taxable as wages in kind. This means that you must add a percentage of the value of the car to the employee’s wages. You may offset the costs of the car against your revenue. You may also deduct the VAT on these costs, on condition that you take account of private use of the car.
There will be a gradual increase in the added taxable income rate (bijtelling) for electric company cars. This also applies if you lease an electric car. The added taxable income rate for electric cars powered with hydrogen is 12% over the price of a new model. For non-hydrogen zero emission cars the 12% addition applies to a list price of up to €40,000. Any amount over €40.000 has a 22% added taxable income rate. The 12% rate is set for a period of 60 months. After that period the rate is determined anew, according to the rules of that time.
From 1 January 2022 the added taxable income rate for non-hydrogen zero emission cars will go up to 16%.
To stimulate the use of lease bicycles, electric bicycles and pedelecs instead of or combined with a company car, you can both drive a company car and a company bicycle. Employees do not have to calculate the number of private kilometres made on the bicycle. Instead they will have to add 7% of the recommended price of the (new model) bicycle to their taxable income over a period of several years.
Statistics: company car
Number of cars registered to a company or institution.