Can I Claim Firmabil (Company Vehicle) as a Business Expense in Denmark?
Fully deductible for the company. However, any private use by employees or directors creates a taxable benefit (Fri bil) valued at 25% of the car's value per year. Moms on car purchase is not reclaimable for passenger cars used privately — only commercial vans/trucks qualify for full moms reclaim.
What Skattestyrelsen (Danish Tax Agency) says
SKAT allows full deduction of business vehicle costs. Private use triggers Fri bil benefit: 25% of the car's price (min DKK 160,000, actual price if higher) per year, taxed as personal income. For moms: no input moms reclaim on passenger car (personbil) purchases. Commercial vehicles (varevogn) with business-only use: 100% moms reclaim.
When you can claim
- Purchase price or leasing costs of business-use vehicles (100% deductible for income tax)
- Fuel, insurance, servicing, road tax for business vehicles
- Electric company cars: same Fri bil rules apply, though slightly lower valuation for environmental incentive
- Commercial vans (varevogne) used exclusively for business — full moms reclaim on purchase and running costs
- Mileage reimbursement at SKAT standard rates: DKK 2.23/km for first 20,000 km, DKK 1.12/km above (2025)
When you cannot claim
- Moms on passenger car purchase — no reclaim regardless of business use percentage
- Private motoring costs where no proper mileage log is kept
- Parking fines and traffic penalties — never deductible
Good to know
Pro tip: Keep a detailed kørselsregnskab (mileage log) showing date, destination, km, and business purpose for every trip. Without it, SKAT assumes all use is private. For sole traders using a personal car for business, claim the standard SKAT mileage rate rather than actual costs to avoid the complexity of splitting private/business mileage.
Important: The Fri bil benefit applies if the car is available for private use — even if the director claims not to use it privately. The burden of proof is on the company to show the car is genuinely restricted to business use (e.g. kept at business premises, written policy). Most SKAT auditors assume private availability unless clearly documented otherwise.
Related expenses
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