Regulation of the company car tax
In the post below, we review the detailed rules related to the company car tax, and later, in another article, we are going to look in more detail at what other tax burdens arise in the case of a company car.
The most important part of the article is that the tax payable on the company car – as shown in the table – almost doubled from July (as an extra-profit tax). According to this, the rate of company car tax between July 1, 2022, and December 31, 2022, will be as follows (the previously effective rate in brackets):
|1.||Engine capacity (kW)||„0”–„4” categories||„6”–„10” categories||„5”; „14–15” categories|
|2.||0-50||HUF 30 500 (16 500)||HUF 16 000 (8 800)||HUF 14 000 (7 700)|
|3.||51-90||HUF 41 000 (22 000)||HUF 20 000 (11 000)||HUF 16 000 (8 800)|
|4.||91-120||HUF 61 000 (33 000)||HUF 41 000 (22 000)||HUF 20 000 (11 000)|
|5.||Over 120||HUF 81 000 (44 000)||HUF 61 000 (33 000)||HUF 41 000 (22 000)|
The monthly rate of the tax according to its capacity expressed in kW and environmental category.
Company car tax is payable for any passenger car not owned by a private individual or owned by a private individual, but costs or depreciation is accounted on them. It – as a rule – needs to be self-assessed quarterly (which involves an obligation to assess, declare and pay the tax) for each month of the calendar year, in which the tax liability exists.
From the perspective of this tax, a passenger car is a passenger car based on Act on PIT, excluding the environmentally friendly cars.
The environmentally friendly car
The environmentally friendly car is the electric car and cars with zero emission. A zero-emission car is a car, which does not emit air pollutants during its intended use (environmental classification code: 5Z).
The passenger car
For the purposes of the company car tax, a passenger car shall mean a motor vehicle equipped with three or four wheels with a passenger capacity of no more than eight adults, including the driver.
According to the general rule, the taxable person is the owner. If the passenger car is included in the official register, the taxable person is the registered owner, unless the owner is a private individual and no expenses are claimed for the passenger car.
In conclusion a company is liable to pay company car tax if:
- it has the ownership of a passenger car with Hungarian registration number not financially leased;
- it claims expenses for a passenger car not included in the official register (e.g. with a foreign registration number);
- the company financially lease a passenger car.
A private individual is liable to pay company car tax if:
- he claims expenses for a passenger car owned by him;
- another party claims expenses for a passenger car with Hungarian registration number;
- he claims expenses for a passenger car not included in the official register;
- he or another party claims expenses for a passenger car financially leased by him;
- the passenger car has a company owner too besides the private individuals ownership.
Elimination of double taxation
The quarterly payable motor vehicle tax imposed on the taxable person for the passenger car can be deducted from the company car tax, for those months of the quarter, in which the taxable person was liable for the payment of company car tax and motor vehicle tax for the same passenger car, provided that the motor vehicle tax was paid within the applicable deadline. If the two taxes are payable by two separate persons, the deduction cannot be applied.