guest blog by Peter Brink van zzp-boekhouder.nl
The sun is shining, vitamin D is good for your health and exercise is good for your heart and body. Yet many entrepreneurs go to their assignment or work location by car or by public transport. And that while the company bicycle offers them countless advantages. The costs are deductible, you get the VAT back on purchase, it is good for your body. And your mind will benefit because you will be more relaxed at work and at home.
There is only one catch in the grass. You must add 7 percent of the value of the bicycle to your profit, but you may deduct all costs. Think of the insurance of the bicycle, the lock, the depreciation on the bicycle, repair and maintenance.
If you want to print the bicycle, you may still be eligible for other tax benefits, read on. Because the electric bicycle can also generate money.
Calculation example company bicycle
Many freelancers want to know immediately what an investment will yield them. And they are right.
If you buy a bicycle for €1,500 excluding VAT and you pay €1,815. Then as a self-employed person you can set off the € 315 in VAT against the turnover tax to be paid. The remaining €1,500 appears on the balance sheet as an asset and can be deducted as expenses over a five-year period.
Assume an average benefit of about 40 percent in income tax -IB- on € 1,500. The bicycle for which you paid €1,815 in the shop will then cost you only €900 net. A disadvantage, you must add 7 percent of the value of the bicycle to your profit.
Company electric bike
There are even more benefits to be gained if the purchase price increases. For example, the electric bicycle of 2,400 euros excluding VAT seems quite pricey at first glance, but if you take advantage of the tax benefits, it is not that bad.. When purchasing a two-wheeler that costs 2,400 euros excluding VAT, you are also eligible for Investment Deduction – KIA and Environmental Investment Allowance -MIA-.
The small-scale investment deduction starts in 2021 with a percentage of 28% if the investment total per year is higher than €2,400, but does not exceed €59,170.
MIA (Environmental Investment Allowance)
On the 'environmental list', which you will find at rvo, you will find the options for deduction. The MIA even applies to operational leases. It is then assigned to the leasing company.
You do have to follow some rules. You must register the purchase of the bicycle with the RVO within three months of entering into the investment obligation. Normally the bicycle shop will give you the information you need to do.
There is also MIA for the electric moped or light moped. That is fifty percent eligible for MIA at a percentage of 13.5%. You may also arbitrarily depreciate 75%, if that is interesting for tax purposes.
You may also buy several bicycles at the store. If you buy a cargo bike for transport, a speed pedelec for long distances and a city bike for normal commuting and you also use it privately, you only have to add the addition. All costs are deductible.
Deduct the costs of the bicycle
The bicycle of € 1,500 excl. VAT may not be booked directly as costs. You must depreciate the bicycle in five years and take into account a residual value of ten percent. Your self-employed bookkeeper puts the bicycle on the balance.