Thanks to all the tax incentives, company-owned (semi-)electric cars have become increasingly popular. To ensure the most environmentally friendly use of such a car, the employee needs a charging point. However, until recently, it was unclear how a charging point reimbursed or provided by the employer to the employee, installed in or near the employee’s home, should be treated for tax purposes.
In a decision dated 21 January 2015, the State Secretary for Finance confirmed that the reimbursement or provision of a charging point at the employee’s home is deemed to form part of the provision of the car (for which the employer may or may not be required to include an additional tax liability in the employee’s salary). Consequently, the reimbursement or provision of the charging point has no separate implications for the determination of the salary. The reimbursement or provision of the charging point does not increase the list price of the car.
The same applies to an entrepreneur who includes the (semi-)electric car in the business assets of their sole trader business (or partnership/general partnership). For the purposes of determining the withdrawal from business assets in connection with the private use of the car, the charging point is deemed to form part of the provision of the car.
This does not apply to the electricity required to power the car. However, in this regard, the State Secretary has approved that the employer and employee may agree that the employee shall supply the electricity actually consumed by the car to the employer at cost price. These costs therefore also include the cost of the meter used to determine the actual consumption by the car.
This approval does not apply to the reimbursement or provision of a charging point to an employee with a private car. The reimbursement or provision of the charging point must then be covered by the tax-free allowance of up to €0.19 per business kilometre (including the journey between home and work). The costs of electricity are also deemed to be included in this tax-free allowance.
The decision concerns the implications of the reimbursement or provision of a charging point for the purposes of payroll tax and income tax. The approvals do not cover the implications for VAT.