An individual tax ruling was requested by a company that has electric cars in its fleet. The company provides the cars to its employees for both business and personal use. The company asked whether the statutory lump sum of PLN 250/400 per month (depending on the engine capacity) could be used for the settlements regarding this benefit and, moreover, whether the employer's reimbursement of electricity costs incurred by employees for charging company cars at their homes fell within the said lump sum.

In the tax ruling, the Director of the National Treasury Information Service stated that the engine capacity of an electric car is 0, and thus falls within the range “up to 1600 cm3”. This means that the monetary value of the free benefit resulting from the use of an electric company car by an employee for private purposes is PLN 250 per month.

However, the additional benefit - reimbursement of the cost of charging the electric vehicle at home (paid, in fact, also in a lump sum form) should be considered separately. This lump sum is paid regardless of whether or how much the employee incurs, regardless of whether or to what extent the employee uses the car for private needs, and without obtaining a confirmation that the vehicle was actually charged “at the employee’s home”. In view of the above, the Director of the NTIS concluded that the lump sum payment for the cost of charging a company electric car at home would constitute the employee’s employment income.

In September 2020, a general ruling was issued on taxation of the use of company cars for private purposes. Unfortunately, in this document, the Minister of Finance did not clarify the doubts related to the settlements related to electric cars. The tax rulings issued recently, including the one discussed in this alert, fill this gap.
 

Find more in the PRO HR July 2021.