Supreme Court Rules on VAT Deduction Calculation for Mixed-Use Vehicles

• The Supreme Administrative Court ruled on October 7, 2025 regarding VAT deductions for vehicles used for both business and private purposes
• Taxpayers must first calculate input tax attributable to business activity using Article 86 rules of the VAT Act
• After determining business-related input tax, taxpayers must apply the 50 percent deduction specified in Article 86a of the VAT Act
• The deduction applies specifically to input tax on motor vehicle expenses
• This ruling was made in case file I FSK 1585/22

Source: kpmg.com

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.

---

---