Fuel to company’s car used for private purposes is subject to PIT

Employees who use a company’s cars for private purposes for free receive a gratuitous performance which is subject to PIT. As from January 1, 2015, money value of such performance is established by a flat rate depending on an engine’s capacity of a vehicle.

Employers often wonder whether such flat rate covers only performances associated with use of a car or also other costs connected with such usage like certain amount of petrol designed to be used for private purposes of an employee paid by an employer.

According to the newest tax interpretation issued by the Director of Tax Chamber in Katowice, a flat rate amount of gratuitous performance covers only employer’s costs resulting from handing an employee with a company’s car for private purposes. Whereas if an employer decides to additionally cover other costs such as petrol used for private purposes, then the whole cost would stipulate a PIT-taxed income of an employee resulting from an employment relationship.

Case no: IBPB-2-1/4511-109/15/MD

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