Sale of a business car


In the case of expenses related to the operation of a private car used in business activities, the taxpayer has the right to reduce the input tax by the input tax. The Personal and Legal Persons Income Tax Act impose the obligation to keep a vehicle mileage record in this case. It enables these expenses to be classified as tax deductible costs. Tax-deductible costs are not considered expenses related to the use of passenger cars for business purposes, which are not taxpayer's assets, if they exceed the amount resulting from the multiplication of the number of kilometers of the actual vehicle mileage and the rate for 1 kilometer of mileage. This rate is specified in the regulations issued by the competent minister. According to this formula, a register of the vehicle's mileage is kept. Read the article and find out about selling a business car!

Selling a car and VAT

Sales of new motor vehicles are taxed at 23% VAT. In the case of the resale of used cars within the meaning of Art. 43 (2) of the Value Added Tax Act, it is exempt from VAT. The exemption is governed by Art. 13 section 1 point 5 of the Regulation of the Minister of Finance of April 4, 2011 on the implementation of certain provisions of the Value Added Tax Act, which reads as follows: "The supply of passenger cars and other motor vehicles by taxpayers who, upon purchase of these cars and vehicles had the right to reduce the amount of tax due by the amount of input tax in the amount of 50% or 60% of the tax amount:

  • specified in the invoice or
  • resulting from the customs document, taking into account the amounts resulting from the decision, or
  • due for intra-Community acquisition of goods, or
  • due on the supply of goods for which the taxpayer is the buyer
    - but not more than PLN 5,000 or PLN 6,000, respectively, if these cars and vehicles are used goods. "

Vehicle sale after liquidation of business activity

The sale of a car classified as business-related property is taxed depending on the selected form of taxation used by the taxpayer before the liquidation of the business. In the event that before the liquidation of the business activity, the taxpayer was taxed according to general rules, the sale of the car gives rise to income taxed in the same way. This income is the amount of the difference between the obtained income and the value of the assets shown in the register of fixed assets increased by the value of the depreciation write-offs.

If a taxpayer before liquidation of business activity was subject to flat-rate income tax on recorded revenues, the sale of a car is taxed with a flat rate of 3%. This tax arises at the time of sale.

If the taxpayer was taxed in the form of a tax card before the liquidation of business activity, he does not calculate income tax on the sale of a car classified as fixed assets. The seller is only obliged to pay the monthly amount of the tax card, which results from the decision of the tax office.