If you also drive kilometers with your private car that can be considered as business, you can declare this to your own company. The same applies when it concerns a rental car. The standard amount that you may deduct for business trips is € 0.19 per kilometer driven. If you calculate kilometers for your client, you have to charge VAT on this. The mileage allowance is part of the invoice that you send to your client and you have to charge VAT on the entire invoice, including the mileage allowance. The VAT rate of the kilometers follows the VAT rate of your invoiced hours.
VAT on private car
If your car constitutes private capital, you can not deduct VAT on the purchase. However, you may deduct the VAT on maintenance, repair and operating costs insofar as you use the car for your company. You should also take into account the ratio of the number of business kilometers to the total number of kilometers driven on an annual basis.
From a journey administration must then show which kilometers were private and which business. You may deduct the VAT from both the maintenance costs and the petrol costs in proportion to the kilometers driven by business. This means that you add up all paid VAT on maintenance and fuel and a part of this can be booked as prepaid VAT in the ratio. You must be in possession of the fuel coupons and the maintenance and repair invoices.
For the above-mentioned VAT regulation, your business performance must also be taxable. Entrepreneurs who do not have to charge VAT to their customers, such as doctors, insurance brokers, etc., can not apply this VAT regulation. Nor does the scheme apply if you employ staff (or work for your own company) that pays you a mileage allowance.
Imagine driving 30,000 kilometers per year in your private car. Of these, 20,000 are business and 10,000 are private. This is the ratio 2/3 and 1/3. Suppose that it appears from receipts that the paid VAT of maintenance and fuel in total is 600, -. 2/3 can then be booked on behalf of the company and 1/3 is then private.
No mileage administration
Do you have no mileage administration? Then you set the VAT that you have to pay for private use at 1.5% of the list price of the car, including VAT and bpm. This percentage of 1.5 also applies to the car that you use based on operational lease or financial lease .
Posting costs for your mileage declaration
For freelancers with a sole proprietorship as legal form, booking private paid mileage costs is fairly straightforward. You make a clear overview of the business driven mileage, including: time, destination, customer name, start and end odometer and mileage. You multiply the number of kilometers by 0.19 and you can book this amount as a private deposit in your company. Whether you actually withdraw this amount on a monthly basis or with the annual accounts for your private withdrawals is not important.
You can track these kilometers manually or automatically with a GPS kilometer registration system.