Treatment of period-related additional payments for company car

Additional payments by the employee for the company car that are expressly made for a specific period of time are to be distributed evenly over this period.

According to the requirements of the tax authorities, one-time additional payments made by the employee for the company car must always be offset in full against the imputed income in the year of payment. Any remaining surplus must then be offset in the following year until the additional payment has been fully offset. The Federal Fiscal Court has now contradicted this principle for co-payments that are expressly paid for a specific period of use. Such co-payments are to be distributed evenly over the period for which they are made and taken into account to reduce the benefit.

If, for example, the employee makes an additional payment towards the acquisition costs of the company car which relates to an expected period of use of several years, then the additional payment is to be offset equally against the non-cash benefit from private use during this agreed period. In the case in question, this involved an additional payment for the acquisition costs that was to be spread over a period of 96 months.