Car Allowance Tax France

Income tax in france in 2019.

Car allowance tax france. To illustrate these recent trends the charts below display the prevalence of corporate car allowances in france germany italy russia spain and the united kingdom. Finally for high powered vehicles 36cv or more from 1st jan 2018 there is a supplementary tax called taxe sur les véhicules très puissants of 500 per cheval fiscal. The tax is 160 per year. Taxes on goods and services vat in france.

The mileage allowance limits are issued each year by the french tax administration note. The income tax rates and personal allowances in france are updated annually with new tax tables published for resident and non resident taxpayers. A car allowance is a set amount an employer gives to employees to compensate them for using their car for work reasons. The current mileage allowance limits are the same as last year.

In the first chart covering technology sector companies we see that the prevalence of corporate car allowances declined most visibly in russia and the united kingdom from 2013. Taxe sur la valeur ajoutée or tva vat in french is a tax on certain goods and services which is included in the sale price. This can be doled out on a monthly quarterly or yearly basis. A frequent question asked by our clients is how business travel expenses vary in other countries where employees are held to local tax rules.

The standard vat rate in france is 20. Food and books 5. There are two other car related rules that are good to know in france. Mileage allowance of the french tax administration.

Your car allowance is considered part of your income and could bring you into a higher tax bracket. However there are reduced french vat rates for certain pharmaceuticals public transport hotels restaurants and tickets to sporting cultural events 10. It sets the maximum reimbursement of mileage allowances for employees based on the car horsepower. The tax is only payable on the cv from 36cv upwards.

For example one of our clients had an employee on assignment in france who traveled for work on occasion to china. It is to be abolished in 2021 due to the low tax yield. The tax tables below include the tax rates thresholds and allowances included in the france tax calculator 2019. Car taxes in france car tax in france car taxation in france company car tax france car registration tax france co2 car tax france.

However an allowance of 15 000 is deducted from the tax due because of employees cars. These amounts are added monthly to the payroll. If the company owns the car and provides it to the employee then it is a taxable benefit in kind equal to 9 of the purchase price for new cars or 30 of the payment for leased cars. For instance if your salary is 40k per year but you get a 700 month car allowance you will be taxed on 48 400.