Company Benefits & Expenditures
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Possibilities for operating company cars in Germany

If you are self-employed or freelance, and use your personal and business car, there are some possibilities for the use of the car in the tax declaration.

These are associated with a lot of effort, but may well be worth it in order to give the state no money. Especially important for the tax declaration is always to what extent you use your vehicle private or for business. This is also the way in which you can settle the use of your car with the tax office.

Is the car in private capital or working capital?

The question of whether the passenger car you are using belongs to the company's assets or belongs to your private assets is very important for the treatment in the tax declaration. You can write off a new car for a period of 6 years. On the other hand, you also have the option of subsequently transferring a private car from private assets into the working capital.

How is the use of the car taxed?

In order to correctly fill out your tax declaration you have several options to choose from. If the business use of the car is more than 50 percent and you do not have a travel book, you have to tax the private use with the 1 percent method. They tax the private use of the car with one percent of the gross list price. This can lead to significant tax disadvantages, since an actually more favorable purchase of the car is not taken into account. If you travel privately very little or if you have a very expensive vehicle, it is therefore always advisable to keep a logbook in which all companies and private journeys are listed completely and comprehensibly.This means you only have to tax the actual private usage. If you only use your car up to a maximum of 50 percent, you can also keep it in private assets. Then you can calculate every kilometer driven by the actual costs, which are generally is much higher than the kilometer allowance granted by the tax office of 0.30 Euros per kilometer. In addition, the tax office goes empty if you resell a private car after a few years. Therefore, it is worthwhile to check in advance whether the operational use of the vehicle is over 50 percent. In case of doubt, be sure to get professional assistance from a tax consultant.The costs for this can be claimed in the next tax return.