Deduct road and registration taxes for your car

Yes! The costs of the vehicle registration tax (BIV) and the annual road tax are tax-deductible to the same extent as your company car is.

If your car is 70% tax-deductible, the same principle applies to the registration tax and the road tax.

That’s a nice bonus, because both bills can sometimes be quite steep – especially since you pay these costs without really getting anything in return.

The deduction rate for your company car and car expenses

The maximum tax deductibility of your car depends on two factors:

1. The gram formula based on your car’s CO2 emissions.
   120%- (0.5% x [coefficient] x CO2 )
2. The professional use.

Suppose the gram formula gives you a maximum deductibility of 90% and you use the car for professional purposes 80% of the time: the tax deductibility is then 72% (80% of 90%). Do you use the car exclusively for professional purposes? Then the maximum tax deductibility in this case is 90%.

Note that commuting between home and work is not considered professional use by the tax authorities.

You can extend this maximum tax deductibility to almost all costs related to your car, including the registration tax and the annual road tax.

Read more about the maximum deduction rate for your car here.

Vehicle registration tax (BIV)

BIV, or registration tax, is a one-off tax that every owner (you as a natural person, or your company) of a new or second-hand motor vehicle must pay. You pay this tax in order to use public roads in Belgium.

You receive this tax bill automatically after buying your car. The exact amount depends on, among other things, the type of vehicle, the fuel type, the CO2 emissions, the Euro standard and the date of first registration.

You pay the registration tax (BIV) once per vehicle, and it is tax-deductible to the same extent as your other car expenses.

Road tax

Once your company car is officially registered and you have paid the BIV, you will also have to pay an annual road tax. You receive this bill automatically, and this tax again depends on the type of car, the CO2 emissions, the Euro standard, and so on.

You can book the road tax as a business expense at the same rate as your company car is tax-deductible.

Other car expenses

Other car expenses, such as car accessories, your car insurance, the interest on your car loan, fuel, electricity for charging, repairs and maintenance, are also tax-deductible.

Do you have a light commercial vehicle as a company car? Good news: those costs are 100% deductible for both taxes and VAT (with fully professional use).

You can read all about it here, at deductibles.be. ✨