Company Car Taxation Netherlands
Taxation Electric Cars per January 1, 2020
As of January 1, 2020, there is a gradual increase in the added taxable income rate [bijtelling] for electric (company) cars.
The added taxable income rate for electric cars in 2020 has been increased from 4% to 8% over the price of a new model. If the price of a car is over EUR 45,000, the taxation rate is 22%. After 2020, the added taxable income rate will increase gradually.
The government wants electric cars to become more attractive and affordable for everyone in the long term. For this reason, fiscal measures will continue to stimulate the use of electric company cars above cars running on petrol or diesel.
What is the taxation on company cars?
For employees driving more than 500 kilometres per year for private purposes, this private use will be taxable as wages in kind. This means that a percentage of the value of the car will be added to the employee’s wages. In 2017, the taxation percentage was reduced from 25% to 22%. In case the company car was registered before 2017 and the percentage was 25% at that time, after 2017, the 25% will still be applicable. For electric cars the percentage is per January 1, 2020, 8%.
No taxation for the private use of a car to a maximum of 500 km per year
The Employer is not required to add the taxation for the private use of a car when the employee is driving 500 kilometres or less in a calendar year. The employee has to fill in a form (in Dutch) and hand this over to the payroll department. Geen bijtelling bij maximaal 500 km privégebruik
In need for more information on Employee Benefits? Click here.
- COVID-19: Coronavirus – Government Support Companies Netherlands - March 25, 2020
- COVID-19: Coronavirus – Emergency Fund NOW for Companies - March 17, 2020
- COVID-19: Coronavirus – Employee communication documents - March 16, 2020