Extension of Special Measure for VAT on Private Use of Light Goods Vehicles in Denmark

• The Council of the European Union is considering extending a special measure for Denmark regarding the application of value added tax (VAT) for private use of light goods vehicles.
• Denmark was previously authorized to apply a flat-rate scheme for the private use of these vehicles, which is set to expire on December 31, 2023.
• Denmark has requested an authorization to continue applying the special measure beyond this date.
• The special measure allows taxable persons to use vehicles registered solely for business for private purposes and calculate the taxable amount of services on a daily flat-rate basis.
• The simplified calculation method under the special measure should be limited to 20 days of private use per calendar year.
• Denmark has submitted a report justifying the continued application of the special measure, stating that the amount of VAT charged per day remains unchanged.
• The special measure aims to simplify VAT obligations for taxable persons who occasionally use a vehicle registered solely for business for private purposes.
• The authorization of the special measure does not affect the right to deduct input VAT on vehicles registered solely for business.
• The extension of the special measure should be limited to allow for evaluation of its effectiveness and appropriateness, expiring on December 31, 2026.
• If Denmark requests a further extension, it must submit a report to the Commission by March 31, 2026.
• The special measure is expected to have a negligible effect on tax revenue and no adverse impact on the Union’s own resources from VAT.
• Implementing Decision (EU) 2018/485 will be amended accordingly.

Source: eur-lex.europa.eu

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

---

---