Addition per emission
The addition is a form of tax, because driving a company car is seen as extra income. This applies to both employees and entrepreneurs. This addition is generally calculated on the basis of the catalog value of the car. A percentage is determined based on the car or company car you drive, which is then added to your taxable income or taxed profit.
What is addition and how does it work
Because the addition increases the income on which you have to pay tax, you have to pay more tax. It could also be that you end up in a higher tax scale because of the addition. As a result, the net amount of the addition may even be slightly higher than you had originally expected. It is therefore wise not to just look for a company car, but to compare the advantages and disadvantages. You can also look at options to keep that addition as low as possible.
The Tax and Customs Administration uses a different method for employees and entrepreneurs to calculate the addition. For employees, the addition is added to the taxable income. The addition of entrepreneurs does not go through payroll tax, but the addition is a correction to the profit. The net amount of the addition should be the same in both cases, provided it concerns an equal car and an equally high income.
The addition percentage depends on the CO2 emissions of the car. For cars with no emissions, the addition is 4% of the catalog value. For all other new cars, the addition is currently 22%. The government sets these percentages every year. The addition percentage is fixed for 5 years from the date of the first registration of the vehicle. In recent years, different percentages have been used, especially for cars with reduced emissions. That is why you sometimes see in offers of young used cars that the addition is 7, 14 or 15%.
For cars of 15 years and older, the addition is 35% irrespective of the emissions. That percentage does not apply to the catalog value but to the current value of the car. This is usually the price for which you buy the car. Because the current value of a car of that age is significantly lower than the new price, this so-called youngtimer scheme is quite favorable in terms of addition. You will of course drive an older car with a higher chance of high maintenance costs.
Below is an overview of the addition percentages for recent years and for the coming years.
|15+ years old**||35%||35%||35%||35%||35%||35%||35%||35%|
* The discount on addition for electric cars from 2019 is valid up to 50,000 euros, after that the addition is therefore 22%.
** The addition percentage is calculated on the current value instead of the catalog value for cars of 15 years and older.
To get an indication of the addition, you must first know the catalog value plus the additional cost of any options. Based on the addition percentage, you can calculate which amount will be added to your taxable income. Then it is important to see in which tax bracket you fall so that you also know which tax percentage you have to calculate. If you know that percentage, you can calculate how much extra tax you have to pay for the company car.
Net amount of addition
The catalog value times the addition percentage is the net amount that is added to your income. Multiply this amount by the tax percentage and then divide the result by 12. If the addition resulted in a higher tax rate, part of the addition will still fall under the lower rate. The net addition may therefore be slightly lower.
Also pay attention to the surcharges and VAT correction!
Keep in mind that the increase in your taxable income also affects matters such as rent allowance, healthcare allowance, childcare allowance or child budget. You can check whether this is indeed the case by means of a test calculation on the website of the Tax Authorities. There must also be a so-called VAT correction if VAT was settled when the car was purchased and the car is used privately. VAT must be paid for the share that the car is used privately.