TVS – Company Vehicle Tax
Do you own or use a particular car as a result of your employment in a French company or fixed establishment in France? If so, you must include the TVS in the VAT declaration for the month of December.
The TVS, or more precisely the "Taxe sur les véhicules des sociétés", applies to the following categories of cars
- cars registered as passenger cars
- multi-purpose vehicles, registered in category N1 according to the European classification
- pick-up trucks with at least 5 seats.
It does not matter whether you have registered this car through your French company, leased it, or registered it in the Belgian/Dutch company and charged it to your company in France. As soon as a car is used on French territory on behalf of your French company or fixed establishment in France, this tax applies.
It is an annual tax, calculated quarterly, based on CO2 emissions and the year of registration of the car. This tax represents a non-tax-deductible cost for your company.
The reduction of CO2 emissions is a well-known objective. This tax also makes you aware of this, because the higher the CO2 emissions of your car, the higher the VAT.
Are you planning to buy or lease a new car? If so, it may be worth considering an electric or hybrid vehicle. These types of cars are indeed eligible for a total or partial exemption from TVS.