BUSINESS CARS

• Beneficiaries:
• Craft, trading, industrial, mining companies that have a fleet of cars
• Companies based in Luxembourg implementing the investment on the Luxemburgish territory
• Applicable to new 100% electric vehicles registered as of 1 January 2018 under a company’s name
• Bicycles, quadricycles or hybrid electric cars and plug-in hybrid cars are excluded.
• Applicable to companies which have cars for professional use only, that do not exclusively serve for the transportation of goods and products or the transportation of employees to or from their working place (capacity for at least 9 persons) who are already covered by the current tax credit
• Applicable to business cars in category M1 owned by the employer but not made available to the employee for private purposes (cannot be combined with the benefit in kind for leased vehicles).

·         Two tax credits are possible:

o    Global tax credit: 8% on the first €150,000 and 2% on the amount of the investment exceeding €150,000. Only a maximum of €50,000 are taken into account per car (in theory excluding VAT if the company is subjected to the VAT)

o    Complementary tax credit: 13% of the complementary investment in eligible goods.

·         The tax credits are offset against the tax payable for the current tax year. A deferment is possible for the ten following tax years.

• Proof of payment of the invoice which must be issued in the name of the taxpayer (who must be a legal entity) must accompany the declaration with the vehicle registration certificate and the certificate of conformity (COC).
• The form 800 called “Tax credit for investment” must be attached to the corporate tax return.

>       Deduction of taxes owed by a company for eco-friendly reasons