Using your company lease car privately: this is how you can do it

15 december 2024

Owning a company lease car can have its advantages. Just think of the tax benefits in the case of financial lease. But can you also use this company car for private purposes? You can indeed use a company car privately, but there are a number of catches. Below we from 123Lease will tell you how it works.

Under 500 kilometers

You are allowed to drive a company car for a private trip. However, it is important not to do this too often if you want to avoid paying additional tax. In that case, it is not allowed to drive more than 500 kilometers privately. As long as you stay under that 500 kilometer limit, it is no problem to drive your company car privately without paying additional tax. This applies to both a car that you have purchased and a car that you lease from 123Lease. If you do drive more than 500 kilometers privately, you will have to pay additional tax.

What is additional payment?

If you drive a company car, this is seen as a source of additional income. If you also use this car privately, you have to pay tax on this. In this case, the tax is also called additional tax. You can read all the ins and outs about additional tax in this blog.

Trip registration

To demonstrate that you stay under the 500 kilometer limit, it is important to keep track of your journeys. This way you can also demonstrate this to the Tax Authorities and prevent you from having to pay additional tax. You can keep track of these journeys manually. For example, you can write down all the journeys in a notebook, or download an app in which you can note this down. It is possible that you do not always have time for this, or that you simply forget to keep track. In that case, you can also choose to have a tracker installed in your car. This tracker then automatically keeps track of all the journeys you have made. It is important that you can demonstrate which journeys were business and which were private. You must report this as accurately as possible. For example, you must report the start and end destinations, how many kilometers you have traveled and the corresponding times.

More than 500 kilometers: additional payment

500 kilometers is less than you think. You will soon reach 500 kilometers if you occasionally drive a ride in your private time. If you exceed 500 kilometers, you will have to pay additional tax. How much additional tax you have to pay depends on the additional tax percentage. The height of the additional tax percentage depends on a number of things.

Addition based on emissions

First, the additional tax percentage is determined based on the emissions. An additional tax percentage is determined based on the emissions. For an electric car, you currently pay less additional tax than a car that does emit CO2, such as a fuel car or a plug-in hybrid car.

At the time of writing, in 2024, you will pay an additional tax rate of 16 percent for an electric car. This percentage applies to the first 30,000 euros of the catalogue price. After that, you will pay the standard additional tax rate of 22 percent.

22 percent is the standard percentage

That 22 percent is also the standard percentage that you pay for all other cars. Whether you drive a hybrid car or a diesel car: you pay 22 percent additional tax on this. You pay the additional tax percentage on the catalogue value of the car. The higher the catalogue value, the more additional tax you will pay. In order to pay as little additional tax as possible, it is therefore certainly smart to look at the catalogue value of the car.

Please note that the additional tax percentages can change every year. At the moment we pay 16 percent additional tax for an electric car , but in 2025 this will be increased to 17 percent on the first 30,000 euros of the catalogue value. In 2026 you will pay the full amount for the additional tax, because from that year on the additional tax percentage for electric cars will be 22 percent as standard.

35 percent for youngtimers

There is an exception, however. In this case, we are talking about youngtimers. A youngtimer is a car that is fifteen years or older. For youngtimers, you pay an additional tax percentage of 35 percent. You will say: that is an extremely high percentage. But fortunately, that 35 percent is calculated on the current value of the car. In this case, you pay a lot less additional tax than when you compare it to a new car. The additional tax percentage of a youngtimer is 35 percent as standard and in this case, the car's emissions are not taken into account.

60 months

It is also good to know that the additional benefit percentage is fixed for 60 months, or 5 years. So you can benefit from the same additional benefit percentage for 60 months. These 60 months start at the moment the car is registered in the Netherlands. When the 60 months are over, the additional benefit percentage is calculated on the basis of the rates that apply at that time. For example, you may lease a car from 123Lease that was registered in the Netherlands three years ago, which means that you will pay the additional benefit percentage that applied at that time for two more years. This can be beneficial, as the additional benefit percentage increases every year - in the case of an electric car.

Private driving in a company car is possible, but take into account additional costs

So you can use your company car for private purposes. In this case, you have two options: either drive less than 500 kilometers privately and pay no additional tax, or drive more than 500 kilometers privately and pay additional tax. It is good to delve into this, so that you can find out what is and is not possible for you. Also definitely look at the catalogue value of the car, since that plays a major role in how much additional tax you will ultimately pay. The additional tax percentage is calculated on the catalogue value of the car. Or in the case of a youngtimer: the current value.

Are you not sure what is most beneficial for you? Then you can contact the experts at 123Lease. We will explain to you in detail how it works with the private use of your lease car and will be happy to provide you with advice.