- French VAT on company vehicles can now be recovered under certain conditions.
- VAT is applicable when a vehicle is provided to an employee in exchange for compensation.
- This allows businesses to deduct VAT on vehicle-related costs.
- Previously, VAT was not deductible on passenger vehicles unless exceptions applied.
- The new rule impacts companies providing vehicles for both professional and private use.
- VAT becomes deductible on the purchase or lease of vehicles if compensation is involved.
- This change may offset increased costs from the 2025 reform of benefits in kind on vehicles.
- Companies need to review their vehicle management policies to understand VAT implications.
- The French tax administration now requires VAT collection on employee compensation for vehicle use.
- This change offers potential savings but also poses fiscal risks for businesses.
Source: cyplom.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.
