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V3629-15 19 November 2015 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · rendimientos del trabajo

Personal vehicle expenses cannot be deducted from Income Tax if earned from employment income

A rural postman using his own vehicle and receiving mileage allowances has enquired whether he can deduct vehicle expenses. The Directorate General for Taxes (DGT) has ruled that, as these are classified as employment income rather than income from economic activities, vehicle expenses are not deductible.

The question raised

Question posed: Possibility of deducting expenses associated with the use of a vehicle in Personal Income Tax (IRPF).

The DGT's ruling

Expenses for the use of a personal vehicle are not deductible for Personal Income Tax (IRPF) for those receiving income from employment, pursuant to Article 19.2 of the Personal Income Tax Law (LIRPF). Mileage compensation shall only be exempt from taxation up to the limit of 0.19 euros per kilometer traveled, provided that the reality of the displacement is justified. Any amount exceeding said limit must be taxed as employment income.

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