What is involved in buying a company car?
Buying a company car may be desirable for you. Perhaps you do a lot of kilometres for your work as a self-employed person. In that case, you can save on taxes by purchasing a company car through your company.
But what all should you think about when buying and using a company car? Are there differences for use as an individual or as a self-employed person? And in terms of insurance, is there a difference between business and private use? Alpina will find out for you.
Company car zzp
Purchasing a company car in your company name brings a number of advantages. Think of tax advantages. Below, we list a number of them for you.
Car expenses
It is possible to write off certain costs of your company car when you have purchased it in the name of your company. These are for instance petrol costs, maintenance, insurances and even parking costs. These costs should be calculated without VAT in the first place, we will tell you more about this in the next section. You can deduct these costs in your income tax return.
In order to declare petrol costs/miles travelled, you must keep a trip log. This makes it possible to find out which kilometres you have actually driven for business purposes.
Fines, however, may never be claimed. They are at your own risk.
VAT return
As mentioned above, you can claim expenses without the VAT. This is because you have to declare the VAT separately. You can then claim the VAT that you have incurred on these costs.
Additional charge
The addition depends on the use of your car. Do you drive it strictly for business purposes? Then you do not have to pay an additional taxable benefit. Do you drive more than 500 km per year with your company car? Then you have to pay an additional taxable benefit.
Take out commercial vehicle insurance? Calculate your premium!
Can you buy a company car as an individual?
You can also purchase your company car as a private person. In that case, you do not purchase the car in the name of your company, but in your own name.
By purchasing the car as a private person, you cannot make use of certain deductions. For example, you cannot deduct the VAT and the costs for petrol, maintenance, etc. from your tax return.
What you can do, when you buy your company car privately, is deduct the kilometres you drive on business from your profit. You then list these kilometres as costs for your company. In this way, your company will make less profit, but you will also pay less tax.
Whether it is more advantageous for you to purchase a company car privately or on your company premises depends on the costs you expect to incur. The kilometres that you drive privately are also important. The additional tax liability can be a hefty sum, on which your company also has to pay tax. So make a calculation in advance. This way, you will know what is most advantageous for you.
Insurance for your company car
What kind of insurance do you need as a self-employed person for your company car? And what kind of insurance do you need as a private individual?
Insuring a company car as a self-employed person
Have you purchased a company car in your name? Then you should at least insure it against third-party liability. This form of insurance is compulsory. This only covers the damage you cause to others. Your own damage is not covered.
In addition, you can choose a more extensive company car insurance such as WA limited casco and ALL-Risk insurance.
With WA limited hull insurance, in addition to third-party damage, you are also insured for theft, collisions with animals, weather damage and damage caused by fire or explosions. This way you are insured for most types of damage.
With an ALL-Risk insurance you are also insured against damage that you cause to another person. Do you accidentally hit the door of another car? Then this damage will be compensated by your insurance.
Please note that you cannot deduct the insurance as an expense if you purchase your company car as a private person.
Get your commercial vehicle insurance through Alpina: simple and affordable
Are you considering insurance for your company car? Then take it out now through Alpina! Thanks to our years of experience, we can offer you the best insurance. Do you still have doubts or questions about our company car insurance? Feel free to contact our customer service. They are ready to answer all your questions.
Read also:
- How much is depreciation in commercial motor insurance?
- Own transport insurance with company car insurance
- Is the electric company car on the rise?
- All-Risk cover for commercial motor insurance
- Accidental occupant insurance with commercial motor insurance
- A business car insurance that suits you: Do you insure your car on a business or private basis?
- Additional cover for commercial motor insurance
- Passenger insurance with commercial vehicle insurance
- WA + Limited Casco
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