This is a frequently asked question. It is important to know this, because when a fiscal mileage log must be kept, in most cases only 500 kilometers may be driven privately per year. The answer to the question of whether commuting is private or business depends on which regulation you are considering: the taxable benefit or VAT. We will explain further.
Business commuting for additional tax purposes
By commuting, the Tax and Customs Administration means traveling back and forth from the place of residence to a fixed workplace, and this is considered a business trip . The distance from home to work (commuting) is entirely classified as business travel for the purpose of the taxable benefit. Furthermore, a ruling by the Supreme Court has clarified that the trip to have lunch at home is also considered a business trip.
No fixed work address
But what if the employee has an employment contract that doesn't specify a fixed work address? How is commuting considered? In this case, all travel from home to a business address counts as commuting. This also includes occasional travel from home to the business address, for example, to pick up materials. If a construction worker or maintenance technician travels to a construction site or a customer's address, then that is considered commuting. no commuting.
Private commuting for VAT purposes
When driving a company car , an annual VAT correction must be made for private use. This is because you are not allowed to reclaim all VAT on car expenses, as a portion relates to private use. Many business drivers do not have to pay a taxable benefit because they keep a mileage log and do not drive private kilometers. Nevertheless, you may still need to make a VAT correction because commuting is considered private for VAT purposes, whereas these kilometers are considered business for the taxable benefit.
TrackJack spoke with Heleen Elbert, a tax lawyer and the expert on everything related to the Tax Authorities and the automotive industry.
Easily distinguish between private and business trips
Manually keeping track of all your trips, including whether they were for business, pleasure, or commuting, is a time-consuming task with a high risk of errors. A much easier way is to opt for a GPS trip logging system . This is a small device installed in the car that automatically tracks all your trips. You can set time periods for when you usually drive for business or pleasure so that a trip is immediately assigned the correct character. Or you can install a private button in the car and press it when you take a private trip. Very easy. And, of course, everything can be edited afterwards.
