Before getting to the heart of the matter, let's clear up one crucial point. If you are a micro-entrepreneur (self-employed), you cannot choose neither actual expenses nor mileage allowances<\/strong>.<\/p>\n\n\n\n Why? Because the tax authorities already apply a flat-rate allowance to your turnover (34,% for BNC services or 50,% for BIC) which is supposed to cover all your professional expenses. You cannot deduct your expenses a second time.<\/p>\n\n\n\n The principle is simple: you use your personal vehicle for work, and your company reimburses you in the form of a lump sum allowance.<\/p>\n\n\n\n This is a very popular option because these allowances are not neither subject to social security contributions nor income tax<\/strong>. It's \u00abnet in your pocket\u00bb.<\/p>\n\n\n\n The mileage scale is an \u00aball-inclusive\u00bb flat rate. It includes:<\/p>\n\n\n\n Please note:<\/strong> You cannot charge these expenses to the company account if you opt for IK. It is your personal credit card that must be used.<\/p>\n\n\n\n However, you may deduct in addition<\/strong> of the scale:<\/p>\n\n\n\n To be eligible for IK, the vehicle must be privately owned. The vehicle registration document must be in your name or, at a pinch, in the name of your spouse if you are in the same tax household. If the vehicle registration document is in the name of the company, IK are strictly prohibited.<\/p>\n\n\n\n In the case of a long-term hire (LLD) or lease purchase agreement (LOA) for personal use, this is possible, provided that the contract is in your name and not in the company's name.<\/p>\n\n\n\n Here, the logic is reversed: the vehicle is purchased (or leased) by the company and recorded as an asset. Everything is paid for using the company's credit card.<\/p>\n\n\n\n This is the often overlooked downside. If the company owns the vehicle, when it is resold, the difference between the sale price and the remaining book value (after depreciation) constitutes a professional added value<\/strong>. This capital gain is taxable and may offset a large portion of the tax savings achieved in previous years.<\/p>\n\n\n\n While IKs may seem attractive, their application to the private hire vehicle industry involves areas of risk that must be managed in order to avoid penalties.<\/p>\n\n\n\n The IK scale was initially designed for secondary professional use (a sales representative who occasionally uses their car). For a private hire vehicle, the car is the main work tool.<\/p>\n\n\n\n If you travel 60,000 km per year in a powerful vehicle, the amount of IK can reach astronomical heights (sometimes exceeding your executive salary). URSSAF may then consider this to be disguised remuneration intended to avoid social security contributions.<\/p>\n\n\n\n The parade:<\/strong> The ruling. It is strongly recommended that you submit a request for a tax and social security ruling. You formally ask the authorities whether your practice is compliant. A lack of response or a positive response protects you legally in the event of a future audit.<\/p>\n\n\n\n In the event of an inspection, the burden of proof lies with you. A simple photograph of the meter at the beginning and end of the year is sufficient. completely inadequate<\/strong> and will result in rejection of the KIs.<\/p>\n\n\n\n You must be able to justify every kilometre travelled for business purposes. This involves:<\/p>\n\n\n\n Good to know:<\/strong> Approach journeys (picking up a customer) and return journeys without passengers are business journeys. They must be recorded, but they are more difficult to prove than journeys with a customer on board. The use of a GPS tracking application or a meticulous logbook is therefore essential.<\/p>\n\n\n\n There is an interesting intermediate strategy suggested by some accountants: sell your personal vehicle to your own company (SASU).<\/p>\n\n\n\n How does it work?<\/p>\n\n\n\n This is an excellent way to quickly recover cash without paying tax on it, while switching to a simplified management system where the company pays everything directly.<\/p>\n\n\n
\n\n\n\nOption 1: Mileage Allowances (IK) \u2013 The path of apparent \u00absimplicity\u00bb<\/h2>\n\n\n\n
What the scale covers (and does not cover)<\/h3>\n\n\n\n
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The golden rule of vehicle registration<\/h3>\n\n\n\n
\n\n\n\nOption 2: Actual Costs \u2013 Pure Accounting Logic<\/h2>\n\n\n\n
Tax benefits<\/h3>\n\n\n\n
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The resale trap<\/h3>\n\n\n\n
\n\n\n\nThe specifics and risks of private hire vehicles: What they don't always tell you<\/h2>\n\n\n\n
The risk of reclassification as disguised salary<\/h3>\n\n\n\n
The hell of proof (Justification)<\/h3>\n\n\n\n
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\n\n\n\nA third strategic option: the Partner Current Account<\/h2>\n\n\n\n
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