The tax management of company cars in Italy varies significantly based on the role of the beneficiary and the use of the vehicle. Understanding these differences is essential to optimize tax benefits and ensure compliance with applicable regulations.
1. Differences in Tax Deductibility: Employees, Directors and Partners
-
Employees : When a company car is assigned to an employee for mixed use (both work and personal), the company can deduct 70% of the costs incurred, with no specific limits on the cost of the vehicle.
-
Directors : For directors, the deductibility of company car costs is 100% up to the amount of the fringe benefit taxed to the director. The excess is deductible at 20%, with a cost limit of €18,075.99 for cars.
-
Partners : If the car is assigned to a partner who is not an employee or director, the deductibility is generally limited to 20% of the costs, with the same cost limits applicable to directors.
2. Assignment of Company Car to Employee Spouse
If the company car is assigned to your wife as an employee, the use of the vehicle should be strictly related to her job duties. Use by third parties, including yourself, could raise tax and insurance issues. It is advisable to formalize the assignment through a contract or a clause in the employment contract, specifying the conditions of use.
3. Deductibility of Costs in Long-Term Rental (NLT)
In the case of long-term rental, the 70% deductibility applies to both the rental fee and the additional costs included in the contract, such as maintenance, insurance and other related services. For fuel expenses, the deductibility is also 70%, provided that the mixed use is documented and the assignment to the employee is for the majority of the tax period.
4. Calculating Fringe Benefit for Directors with NLT
For administrators, the fringe benefit is calculated based on the normal value of the vehicle, determined according to the ACI tables, considering a conventional mileage of 15,000 km per year. The applicable percentage varies based on the vehicle's CO₂ emissions:
- Up to 60 g/km: 25%
- Between 60 and 160 g/km: 30%
- Between 160 and 190 g/km: 50%
- Over 190 g/km: 60%
For example, for a vehicle with emissions of 150 g/km and an ACI kilometre cost of €0.50/km:
- Annual cost: €0.50 x 15,000 km = €7,500
- Fringe benefit: 30% of €7,500 = €2,250
This amount represents the taxable value of the administrator.
Managing the taxation of company cars requires careful planning and a clear understanding of the regulations. It is advisable to consult a tax advisor to evaluate the most advantageous options based on the specific business and personal situation.
