Skip to content
Back to index
V0413-19 27 February 2019 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · retribución en especie

Vehicle leasing for private use may be treated as benefits in kind or cash remuneration depending on the agreement

A company has enquired whether providing employees with access to renting contracts, with the cost deducted from their salary, constitutes a benefit in kind. The Directorate-General for Tax (DGT) clarifies that if it is merely a payment mediation service, it is cash remuneration; however, if it is stipulated in a contract or collective agreement as a benefit, it is classified as a benefit in kind.

The question raised

Tax treatment applicable to the transfer of use of vehicles that the entity would offer to its employees.

The DGT's ruling

If the company acts as a payment intermediary so that the employee acquires the service, it is considered monetary remuneration. However, if the provision of the vehicle is agreed upon in the employment contract or collective bargaining agreement, it constitutes remuneration in kind. In the latter case, if the vehicle is not owned by the company, the annual valuation is 20% of the market value of a new vehicle. This remuneration includes insurance, taxes, and maintenance, but not fuel, which would be independent remuneration.

Book your free first meeting