Can I Claim Vehicle and Fuel Costs as a Business Expense in France?
Partly. Running a vehicle for the business is deductible, but the VAT on passenger cars is generally not, only part of the VAT on their fuel is, and a car also given to staff or directors for private use is a benefit in kind.
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What Direction générale des Finances publiques (DGFiP) says
Vehicle costs are the biggest area where French rules differ from what founders expect. For income tax purposes the costs of a vehicle used for the business, such as insurance, maintenance and depreciation, are deductible in proportion to business use. For VAT, the BOFiP is strict: vehicles designed to carry people, or of mixed use, are excluded from VAT deduction when they are fixed assets or not meant for resale as new. That covers most cars and camper vans. The VAT on fuel for those excluded vehicles is deductible only in part, with the share set in the BOFiP table, while a utility vehicle that is not excluded follows the common-law rules. Fuel for private trips is never deductible. When the company makes a car available to a director or an employee for private use, it creates a benefit in kind. For 2026 the flat-rate method values it at 15% of the purchase cost a year, or 10% if the vehicle is more than 5 years old, with fuel excluded, and the value is added to the person's pay. The company can also reimburse mileage for the use of a private car with the tax mileage scale. Because the rules depend on the type of vehicle, ask your expert-comptable before buying and keep a log of business trips.
When you can claim
- Insurance, servicing and repairs for a vehicle used in the business
- Depreciation of a business vehicle, in proportion to business use
- Tolls and parking for business trips
- Mileage reimbursed for the business use of a private car
- VAT on utility vehicles that are not excluded from deduction
- The part of fuel VAT that the BOFiP allows for excluded vehicles
When you cannot claim
- VAT on the purchase or rental of a passenger car held as a fixed asset
- Fuel for private journeys
- Fines and penalties, which are never deductible
Good to know
Pro tip: Keep a simple mileage log with dates, destinations and reasons. It supports the business-use share and protects you if the tax office asks.
Important: Benefits in kind change payroll. If a company car is made available to a director on payroll, tell your expert-comptable so the DSN is right.
Related expenses
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