- VAT Declaration for Private Use: In the last VAT return of 2025, businesses must declare VAT on the private use of company cars, including commuting. Commuting is considered private use for VAT purposes, and if the car is used for both business and private purposes, a correction for private use must be calculated.
- Calculation Methods: The VAT correction can be calculated based on mileage if there is a comprehensive mileage administration. If not, a flat rate of 2.7% (or 1.5% for cars older than 5 years) of the car’s list price including VAT is applied. The correction depends on whether VAT was deducted when purchasing the vehicle, with specific calculations laid out for various scenarios.
- Personal Contribution and VAT Liability: If employees pay a personal contribution for private use, VAT must be declared based on that contribution, eliminating the need to declare VAT for private use. The normal personal contribution is typically calculated as a percentage of the car’s list price, and the regulations state that commuting is always considered private use, necessitating careful tracking and compliance to avoid penalties.
Source Carola van Vilsteren
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