Car company discount to 40% VAT

18 Dec

Posted by ReD as Cars

For VAT on company cars, towards the non-deductibility to 60 cento.L 'claim is that the EU Commission has given Italy for the European Council's request to limit the deduction of VAT on vehicles up to nine seats other than those that qualify the business, from car agents and representatives and public use. It now awaits the final go-ahead to the EU request, which will take effect from the publication of the decision on the A 'UNION AND Official Gazette. "
Before September 14, 2006, when the Court of Justice said the Italian legislation incompatible with the Sixth EU Directive, the VAT deduction for cars was limited to 15% gliacquisti and lease payments, while it was completely prohibited for maintenance costs (fuel, maintenance, etc.). Decree-Law 258/06 establishes the possibility to request a refund of tax not deducted by applications to be submitted to Treasury by April 16, 2007. The percentage of reimbursement will be determined by the Revenue in the decision to approve the reimbursement, with the possibility for taxpayers to use the ordinary tools of litigation to require a large amount more consistent with actual use of the medium enterprise .
For transactions carried out since 14 September, the deduction of VAT on cars do not meet specific limits, having to simply observe the ordinary rules inherent to the business or professional. Doubts applications are asking for the cars that companies rely on their directors or employees for use even outside working. The quantification of the share to be deducted would have to follow objective criteria and documented, which had not yet been submitted by the Revenue.
The law further provides a third phase, which will kick off with the authorization of the EU Council, which will reintroduce a percentage of non-deductibility applicable, without possibility of proof to the contrary, for all cars except those arising out of activities resale, lease or rent carried by taxpayers and those used by taxi drivers and © by agents and representatives.
The European Commission, by letter dated November 21, noted the reasons put forward by Italy to support the request to determine, notwithstanding the Community rules, a roof to deduct 40% tax paid (60%) for all vehicles other than those mentioned above. The Commission also found that European headquarters are in its way a draft amendment to Article 17 of the Sixth Directive that could establish similar restrictions for the deduction on certain motor vehicles, has recognized the possibility of submitting the application to the EU Council, which is responsible for final authorization. The non-deductibility of 60% should be granted for a period of three years, with the need to renegotiate the measure to the end of the second year, when Italy intends to request an extension.