A moped in the company as a fixed asset - what is worth knowing?


The changes that have occurred in the regulations regarding the settlement of cars in the company since 2014 were quite significant. In practice, many taxpayers have a problem with the correct settlement of cars, which means that they often switch to alternatives, e.g. mopeds or bicycles. Can a moped be a fixed asset in a business? How to properly account for a moped in the company?

Moped in the company - definition

The moped does not have its definition in the tax regulations. Regulations concerning the definition of a moped, as well as the technical conditions it should meet, were included in the Act of June 20, 1997 - Road Traffic Law. The regulations state that a moped is a two- or three-wheeled vehicle equipped with an internal combustion engine with a cylinder capacity not exceeding 50 cm3 or an electric motor with a power of not more than 4 kW, the design of which limits the speed to 45 km / h.

A moped in a company and VAT

As is clear from the above definition, the moped is not a motor vehicle, therefore, when purchasing a moped for a company, it is entitled to deduct the input tax on general terms, i.e. without the limitations provided for motor vehicles within the meaning of the VAT Act. If the entrepreneur carries out a business activity that consists only in the performance of activities subject to VAT, then the taxpayer is entitled to deduct VAT in full, both for the purchase of a moped for the company, fuel for its propulsion, and other expenses related to its day-to-day operation, e.g. parts or service. It must therefore be remembered that for this type of vehicles, the changes to the regulations governing VAT deduction for cars, introduced on April 1, 2014, do not apply.

However, a contentious issue may be the possibility of deducting VAT on the purchase of, for example, a helmet, without which the moped cannot go on any journey. According to the tax office, these costs are personal expenses and not related to business activities.

A moped in a company and depreciation

If the company's moped is to be used for a minimum of 1 year, then it should be considered a fixed asset. For this purpose, the moped is entered in the fixed assets register and depreciation write-offs are made.

If the initial value of the vehicle is lower than PLN 3,500, then the moped may not be entered in the fixed assets register. The taxpayer is then not obliged to make depreciation write-offs, and the expenses incurred for the purchase of the vehicle may be included in the tax deductible costs in the month when it is put into use.

If the moped in the company is worth more than PLN 3,500, the expenditure for its purchase cannot be included in the tax costs in full, but should be spread over time through depreciation write-offs. The depreciation begins the month following the entry of the moped into the fixed assets register and is carried out by the end of the month in which the sum of the depreciation charges are equalized with their initial value or until, for example, the moped is sold.

In this case, one of the depreciation methods can be used:

  • linear - from the list of depreciation rates for a moped with KŚT 740, a 20% rate should be applied. The moped in the company will then be depreciated for 5 years.
  • individual - can be determined for used or improved fixed assets (the taxpayer must prove that the vehicle has been used for more than 6 months) first entered in the records of a given taxpayer, while the depreciation of means of transport should be at least 30 months, which means that the maximum rate the depreciation that can be applied is 40%. The moped will then be depreciated for 2.5 years.
  • increased - this is the depreciation rate for means of transport used more intensively in relation to average conditions or for vehicles requiring special technical efficiency. The basic rate from the list may be increased by a factor of a maximum value of 1.4. It would then be 28% (20% x 1.4). This possibility results from Art. 22i paragraph. 2 point 2 of the PIT Act.
  • one-off - as part of de minimis aid. The possibility of one-off depreciation is available to new entrepreneurs (in the tax year in which they started their business activity) and the so-called small taxpayers (where in 2016 the value of sales revenue, including the amount of VAT due, did not exceed PLN 5,157,000). They can take advantage of one-off depreciation up to the amount not exceeding the equivalent of PLN 50,000 per year. EUR (in 2017 it is PLN 215 thousand) of the total value of these write-offs.

In addition to one-time, line, individual and increased depreciation, the moped in the company can also be depreciated seasonally. If the moped in the company is used by the entrepreneur only for part of the year, depreciation write-offs should be made only during the period of its use. In this case, the amount of the monthly write-off is determined by dividing the annual amount of depreciation by the number of months in the season or by 12 months of the year (Article 22 (1) (3) of the PIT Act).

Example 1.

The taxpayer uses a moped in the company which is a fixed asset with an initial value of PLN 20,000. zloty. It is used in the period March - October, i.e. 8 months a year. The annual depreciation rate for the moped is 20%.

  1. The amount of the monthly depreciation write-off:

(PLN 20,000 x 20%): 8 months = PLN 500

The total amount of depreciation in the season:

PLN 500 x 8 months = PLN 4,000

  1. The amount of the monthly depreciation write-off:

(PLN 20,000 x 20%): 12 months = PLN 333.33

The total amount of depreciation in the season:

PLN 333.33 x 8 months = PLN 2 666.66