While the majority of travel costs are not subject to VAT , certain costs resulting from the trip are, and this is however deductible. The parking fees, if duly justified, are subject to VAT. You can therefore recover the VAT on these costs.
The amount of VAT paid on fuel costs is also deductible
Depending on the type of fuel and the type of vehicle, VAT recovery can reach 100%, 80% or even less. You can therefore recover the VAT on fuels if the expenses are the subject of an expense report accompanied by a supporting document. Use the tax return calculator there.
- Until 2016, only the VAT on diesel was deductible. It was impossible to recover it on gasoline. However, since 2017, part of the VAT on gasoline is deductible.
- 20% of the VAT on gasoline for commercial vehicles can be recovered. This rate is set to increase gradually to reach 100% in 2022.
- The recoverable VAT rate on gasoline will therefore be aligned with that for diesel.
- The VAT recovery is 80% for a passenger vehicle (PV) and 100% for commercial vehicles (LCV). Only the VAT on LPG and CNG (city natural gas) can be fully recovered without any conditions.
Likewise, toll charges are deductible from VAT
As regards parking expenses, VAT is deductible only on condition that the vehicle used is a commercial vehicle. These elements must therefore be taken into account to recover the VAT on the expense reports and to make the most of the deductibility of the VAT on travel expenses. Find your money back with this tutorial on VAT recovery.
VAT on catering and accommodation costs is deductible?
Catering costs: VAT is always deductible
You can reclaim VAT on catering expense reports. Meal expenses fall under the category of mission expenses.
This brings together many types of business expenses. You can thus take advantage of the deductibility of VAT on the meal expenses of an executive, an employee, on the meal expenses for a meeting and of course for a customer lunch.
Below 150 euros of expenditure, a receipt is sufficient to justify your expense report. Don’t forget to remind your employees to always ask for proof to complete the expense report, otherwise you will not be able to recover the deductible VAT!
What about the recovery of VAT on alcohol?
The payment of VAT on alcohol in restaurants is also deductible. However, the VAT rate applicable on alcohol (20%) is different from that of VAT on food (10%) . The purchase invoice must therefore mention both rates if you want to recover the VAT.
Accommodation costs: VAT is not deductible, but there are exceptions
Accommodation costs are part of the list of business expenses with non-deductible VAT, regardless of the situation. Thus, the hotel costs of one of your employees on a business trip cannot be subject to VAT recovery.
The breakfast is often included in the bill of a hotel night. However, the VAT on breakfast is deductible, so remember to remind your employees to ask for a detailed invoice in order to be able to recover the VAT on the breakfast.