Company car or private for self-employed

Quick overview: business or private driving as a self-employed professional

The summary below shows the fiscal essentials per scenario. Use this as a starting point for your choice.

Benefit-in-kind for a company car explained

If you, as a self-employed professional, drive a company car more than 500 kilometers privately per year, you will face benefit-in-kind (bijtelling). This is a percentage of the list price that is added to your profit/income. The percentage depends on CO2 emissions and the type of car. Fully electric cars have a reduced rate in 2025 of 17% up to a list price of €30,000 and 22% for the part above that. For cars older than 15 years (youngtimers), the addition is calculated over the fair market value (day value).

You can only avoid it with a complete mileage log showing that your private kilometers with the company car stay under 500. Also take VAT into account: for private use of a business car you correct VAT via the annual adjustment or per filing period. Unsure whether your actual car costs are lower than the benefit-in-kind? Then driving privately with a mileage allowance is often more attractive. Have Profinancials calculate the tipping point for you. Want to spar about benefit-in-kind and VAT? Schedule a check with a tax advisor in Eindhoven.

Putting a new car on the business as a sole proprietorship or self-employed

Buying a car for business as a sole proprietorship is especially interesting if you drive many business kilometers annually and have structural car costs. You then charge depreciation, financing or lease costs, fuel, insurance, maintenance and road tax to your profit. VAT on purchase and running costs is in principle deductible for the business portion, with a mandatory VAT adjustment for private use.

Key points: choose once per car whether it belongs to your business assets, keep an up-to-date mileage log, and calculate the benefit-in-kind if you drive more than 500 private km. Is the registration in your name or in the company’s name? For sole proprietorships this matters less legally than the fiscal choice you record in your bookkeeping. Profinancials can model depreciation, VAT and the impact on your profit in advance so you won’t face surprises.

Putting an existing private car on the business

If you contribute a current private car to the business, this is done at the market value at the time of contribution. You depreciate from that value. You cannot retrospectively reclaim VAT on the original purchase, but you may deduct VAT on ongoing costs pro rata business use. If you then drive more than 500 private kilometers per year with this business car, benefit-in-kind applies. Ensure your mileage and cost administration is complete from the contribution date. Need help with mileage logs and the choice between private vs business? Engage a bookkeeper for self-employed in Eindhoven.

Leasing a business car: operational vs financial

Leasing can preserve liquidity and provide predictable costs. With operational lease you rent the car: the leasing company remains the economic owner and the monthly fee is fully deductible as an expense. With financial lease you are the economic owner: you capitalize and depreciate; interest is directly deductible. In both cases you process VAT on the installments and running costs, with an adjustment for private use. Choose your lease form based on term, residual value, risk and your need for balance sheet space. Profinancials helps compare whether leasing or putting a car on the business as a self-employed professional is better.

When is staying private smarter?

Driving privately with a mileage allowance is often advantageous if you drive few business kilometers annually, have a relatively inexpensive or older car with low costs, or if the expected benefit-in-kind is higher than your actual car costs. You avoid the addition and keep administration simpler. You then claim €0.23 per business kilometer and can reclaim VAT on running costs proportionally.

Mileage allowance for self-employed using a private car

If you use your private car for business, you may record €0.23 per business kilometer as an expense. This rate covers fuel, depreciation and maintenance. For VAT you deduct the business portion of VAT on maintenance, repairs, insurance and fuel based on your mileage log. Keep fuel and garage receipts and note per trip the date, start and end odometer readings, departure and arrival address, and the business purpose. Then process this correctly in your income tax return.

Van with gray license plate (grijs kenteken) for the self-employed

If you drive a van with a gray license plate that you primarily use for business, total car costs can be fiscally favorable. You charge the costs to your profit and apply VAT deduction for business use. For private use of a business van, benefit-in-kind generally also applies, unless you meet exceptions such as a statement of business-only use. Note: conditions and levies around BPM, MRB and business use of vans change regularly.

Are you a self-employed professional who transports tools and goods or often works on location? Then a gray license plate can be financially more attractive than a passenger car as a company car. Have it checked in advance whether your van meets the fiscal requirements and what the impact is on your profit, VAT and any benefit-in-kind. Profinancials sets out the scenarios clearly side by side, including current rules.

Step-by-step: how to make the right choice and arrange it

• Map your usage: business vs private kilometers, types of trips, expected annual distance.

• Calculate the costs: depreciation or lease, fuel, insurance, maintenance, road tax (MRB), financing, and compare with the expected benefit-in-kind.

• Choose the scenario per car: put the car on the business or keep it private. Record this in your administration.

• Arrange your administration: mileage log, cost receipts, VAT apportionment or VAT adjustment, and any benefit-in-kind.

• Review and optimize: evaluate annually whether your situation has changed and whether refinancing, leasing or driving a different type of car fits better.

Are you switching from private to business driving (or vice versa) or leasing a different car? Then adjust your provisional assessment in time to avoid surprises.

Frequently asked questions

What is more advantageous for a self-employed professional: a company car or private?

That depends on your kilometers, car costs and benefit-in-kind. If you drive a lot for business and have substantial car costs, a company car is often favorable. If your actual costs are lower than the expected benefit-in-kind, then driving privately with €0.23 per business kilometer is usually better. Have the tipping points calculated for your car.

Can I, as a self-employed professional, have a company car?

Yes. You can buy or lease a car for business and charge all costs to your profit. Take into account benefit-in-kind if you drive more than 500 private kilometers per year and a VAT adjustment for private use. Choose once per car whether it is designated as business or private in your bookkeeping.

Can I use my private car for business trips and claim mileage?

Yes. You keep your car private and record €0.23 per business kilometer as an expense. For VAT you deduct the business portion of VAT on running costs proportionally. Benefit-in-kind then does not apply, but an accurate mileage log is required.

Is it cheaper for a self-employed professional to buy or lease a car?

Leasing provides predictable costs and preserves liquidity; buying can be cheaper long term with low financing costs and limited depreciation. The fiscal outcome differs per situation. Compare total cost of ownership including VAT, depreciation/lease, interest and benefit-in-kind.

May I, as a self-employed professional, put 2 cars on the business?

Yes. You assess per car whether it is designated as business or private. For each business car the rules for benefit-in-kind, costs and VAT apply separately. Keep a separate mileage and cost administration per car.

Need a personal calculation or advice?

Want to be sure whether a company car or private is most beneficial for you? Profinancials is happy to calculate it and handle the processing in your bookkeeping and returns. We help self-employed professionals in and around Eindhoven with clear choices and watertight administration.