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V3688-16 ·5 September 2016 ·consulta-vinculante Medium impact
Tax

VAT deductibility for passenger cars (50%) and exclusive use requirements for Personal Income Tax (IRPF)

A hairdressing professional has enquired about the deductibility of VAT and Personal Income Tax (IRPF) regarding a vehicle, repairs, and fuel. The Directorate-General for Traffic (DGT) rules that VAT for passenger cars carries a 50% presumption of business use, whereas for IRPF, deductibility depends on proving exclusive use for the professional activity.

In 6 key points

How it affects those involved

This ruling clarifies the distinction between VAT and IRPF rules for professional vehicle use, highlighting the stricter requirements for income tax deductions compared to the standard VAT presumption.

Lifecycle

2016-09-05PublishedPublished in the BOE
Official text Based on BOE data (boe.es). Information, not advice.

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This analysis is informational only and does not constitute legal advice or create a client-adviser relationship. BM Consulting.
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