{"id":1779,"date":"2024-09-25T20:58:29","date_gmt":"2024-09-25T18:58:29","guid":{"rendered":"https:\/\/globalmindadvisors.com\/vehicles-provided-to-employees-at-no-cost-how-does-it-affect-vat-deduction\/"},"modified":"2024-09-25T21:28:38","modified_gmt":"2024-09-25T19:28:38","slug":"vehicles-provided-to-employees-at-no-cost-how-does-it-affect-vat-deduction","status":"publish","type":"post","link":"https:\/\/globalmindadvisors.com\/en\/vehicles-provided-to-employees-at-no-cost-how-does-it-affect-vat-deduction\/","title":{"rendered":"Vehicles provided to employees at no cost: How does it affect VAT deduction?"},"content":{"rendered":"\t\t
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The Directorate General of Taxes (DGT) has resolved a consultation in which it analyzes whether the transfer of these vehicles to employees, at no cost to them, implies a self-consumption of services subject to VAT.<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t
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We want to clarify a common question that has been raised about the free provision of vehicles to employees and how this may affect VAT, especially when the company has already deducted part of the VAT when acquiring these vehicles through leasing.<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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In this case, the Directorate General of Taxes (DGT) has resolved a binding consultation V1374\/2024 in which it analyzes whether the assignment of these vehicles to employees, at no cost to them, implies a self-consumption of services subject to VAT.<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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When is there self-supply of services?<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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For an operation to be considered a self-supply of services and subject to VAT, two conditions must be met:<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t
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The company has deducted the VAT incurred when acquiring the goods or services.<\/p><\/div><\/div>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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The goods or services are used for purposes other than the business activity.<\/p><\/div><\/div>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Treatment of vehicle provision:<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Part not affecting business activity.<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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When a company acquires a vehicle and only part of it is used for the business activity, while another part is used for the private use of the employer or provided to employees for personal use, this provision is not subject to VAT, according to current jurisprudence (Supreme Court decision of January 29, 2024). <\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Part affecting business activity.<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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If the provision of the vehicle to employees is to fulfill the company's own activities (e.g., for work-related travel), this operation is not considered a self-supply of services. In this case, there would be no need to declare additional VAT, as the vehicle continues to be used for business purposes. <\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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In summary, if the vehicle provided to employees is used for carrying out their functions within the company, there is no concern regarding self-supply of services or adjustments to initially deducted VAT.<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Please feel free to contact this professional office for any questions or clarifications you may have regarding this matter.<\/p>\n\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\t\t\t\t\t

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The Directorate General of Taxes (DGT) has resolved a consultation in which it analyzes whether the transfer of these vehicles to employees, at no cost to them, implies a self-consumption of services subject to VAT. We want to clarify a common question that has been raised about the free provision of vehicles to employees and […]<\/p>\n","protected":false},"author":1,"featured_media":1778,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1779","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-sin-categorizar"],"acf":[],"yoast_head":"\nVehicles provided to employees at no cost: How does it affect VAT deduction? - Global Mind Advisors<\/title>\n<meta name=\"description\" content=\"The Directorate General of Taxes (DGT) has resolved an inquiry regarding whether the provision of these vehicles to employees, at no cost to them, constitutes a self-supply of services subject to VAT. We want to clarify a common question that has been raised about the free provision of vehicles to employees and how this may affect VAT, especially when the company has already deducted part of the VAT when acquiring these vehicles through leasing.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/globalmindadvisors.com\/en\/vehicles-provided-to-employees-at-no-cost-how-does-it-affect-vat-deduction\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Vehicles provided to employees at no cost: How does it affect VAT deduction? - Global Mind Advisors\" \/>\n<meta property=\"og:description\" content=\"The Directorate General of Taxes (DGT) has resolved an inquiry regarding whether the provision of these vehicles to employees, at no cost to them, constitutes a self-supply of services subject to VAT. 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