Theft of a car that is a company's fixed asset

Service-Tax

There are various risks associated with owning a company car, including the risk of losing it as a result of theft. Even such an unpleasant event has consequences in terms of taxes, so it is worth knowing in advance the rules for dealing with theft of a car that is a company's fixed asset.

Car theft and depreciation

The theft of a car that is a company's fixed asset causes a loss in the entrepreneur's property. As a rule, the loss in fixed assets is a tax deductible cost, but only in the part not covered by depreciation write-offs. Therefore, in the event of the theft of a car, costs may include the amount constituting the difference between its initial value and the depreciation write-offs made.

Attention!!! The loss from the theft of a fully depreciated car cannot be recognized as tax deductible costs. In such a case, its value was recognized as costs through write-offs.

Necessity to have AC

In order to be able to count the loss due to the theft of a car as costs, an additional condition is to have voluntary insurance. Such insurance is any type of insurance, except for third party liability insurance.

Other requirements

In the case of the theft of a car that is a company's fixed asset, remember to properly document this event. It should be reported to the appropriate authorities (police, insurer). In addition, the entrepreneur should draw up an appropriate accounting document in which the amount of loss will be determined on the basis of records of fixed assets. Importantly, the appropriate entry should also be included in this document.

It should be remembered that the taxpayer's tax deductible costs cannot include losses resulting from his negligence, lack of diligence, unreasonable actions and when the subject of the loss has not been properly secured.