Taxes on the economic use of private vehicles (ex-TVS)
Verified 29 March 2023 - Legal and Administrative Information Directorate (Prime Minister)
The tax on business vehicles is replaced by 2 taxes: the annual CO emissions tax2 and the annual vehicle age tax. All companies, not just businesses, must pay these taxes on theeconomic use of private vehicles. They concern cars intended mainly for the transport of passengers. The tariff schedules remain the same, but the calculation and payment are done annually and no longer by quarter.
The following 2 taxes must be paid for each vehicle:
- Annual tax on CO₂ emissions : it is determined on the basis of the CO₂ emission rate, the date of entry into service and, in certain cases, on the basis of the fiscal power.
- Annual vehicle age tax : it is determined according to the type of fuel and the date of entry into service.
We'll explain all changes to the old TVS in our news brief.
All business and all individual business (EI) which uses or owns passenger transport vehicles in the course of its economic activity is affected by those taxes.
Depending on the type of vehicle
The 2 taxes relate to the following vehicles:
- Registered in the category M1, i.e. passenger cars (with the mention VP carte grise registered on the certificate of registration). They are designed to carry people and have no more than 8 seats.
- Registered in the category N1 , i.e. vans of less than 3.5 tons which can carry both small goods and persons. Carte grise The following is marked van or code BB in box J2. They must have at least 2 rows of seats.
Of the vehicles in this category, a specific sub-category is also affected by the taxes:- Pickup truck with 5 seats minimum. Carte grise The bodywork description code according to the European classification is BE, entered in box J2 of the certificate of registration. Except for pick-up trucks intended exclusively for ski resorts or ski lifts.
Depending on the use of the vehicle
The 2 taxes concern vehicles whose technical characteristics are intended solely or principally for the passenger transport.
Example :
It is typically the official car of a company, even if it is occasionally used for private purposes.
Vehicles are affected if they meet theany of the following :
- They are owned or rented for a long period (at least 30 consecutive days) by the company and are registered in France.
- The company shall bear all or part of the costs incurred by a natural person in acquiring or using the vehicle. They drive on the public highway of national territory.
- They drive on the public highway of national territory for the purpose of carrying out an economic activity (except vehicles used exclusively for commercial demonstration by dealers, except those lent for technical inspection and those having a provisional registration with a certificate "W garage").
Depending on the use of the vehicle
Vehicles intended exclusively for the following activities are exempt from the 2 taxes:
- Sale, e.g. cars of car dealers, dealers
- Rental, as part of a car rental company
- Transportation of persons in wheelchairs for wheelchair accessible vehicles
- Transport available to the public: taxis and VTC, for example
- Teaching of motor driving (driving school) and sport driving
- Sports competitions
- Used by technical inspection centers
- Used by non-profit organizations
- Designed for exclusively commercial use (e.g. food truck) or industrial use
Depending on the energy source of the vehicle
A vehicle that runs solely on energy electric, tohydrogen, or a combination of both, is exempt.
Carte grise Box P3 of the registration certificate () shall contain either the words H2 (hydrogen) or EL (electricity) or HE or HH (combined).
Depending on the amount of aid received
Individual business Any individual may benefit from an exemption if he does not exceed the de minimis aid threshold corresponding to his sector of activity.
This European framework sets a threshold for small amounts of aid not to be exceeded for the same company over three rolling fiscal years (current and previous two fiscal years):
Sector | Threshold to be respected over 3 rolling fiscal years |
|---|---|
All sectors (except exceptions) | €200,000 |
Carriage of goods by road for hire or reward | €100,000 |
Agriculture | €20,000 |
Fisheries and aquaculture | €30,000 |
An exemption also applies to vehicles designed exclusively for agricultural or forestry use, provided that the company complies with the de minimis rule.
The seniority tax remains due, but the CO tax2 is not required for hybrid vehicles that fulfill criteria related to energy source and CO2 emissions.
The energy source vehicles shall combine one of the following two criteria:
- Electricity or hydrogen on the one hand, and natural gas, liquefied gas, gasoline or superethanol E85 on the other
- Natural gas or liquefied petroleum gas on the one hand and gasoline or superethanol E85 on the other
The CO emissions2 of the vehicle shall also meet one of the following criteria:
- For vehicles registered from 1er March 2020 (WLTP registration procedure), CO2 emissions shall not exceed 60g/km
- For vehicles registered between 1er June 2004 and February 2020 and not allocated for economic purposes before 1er January 2006 (NEDC registration procedure), emissions shall not exceed 50g/km
- Carte grise For other vehicles (registered before 2004 or used for economic purposes before 2006), the administrative (or fiscal) power entered in box P2 of the
- CO emissions2 or the administrative power must not exceed twice the above thresholds and the age of the vehicle (determined from its date of 1)re registration) shall not exceed 3 years
Taxation period extends from 1er January to December 31 of each year.
These taxes are paid for use made of vehicle the previous year.
The calculation of these new taxes shall be carried out in accordance with number of days the vehicle is used in the year.
They are calculated as follows:
(duration of vehicle assignment in France for economic purposes/number of days in the calendar year) x annual tax rate
Annual CO2 tax
The calculation shall be different according to the category to which the vehicle belongs:
- If the vehicle was first registered in France from March 2020, it falls under the new registration system (WLTP). The calculation is based on CO2 emissions.
- If the vehicle has been owned or used by a company since January 2006 and was first put into service after 1er June 2004 (including the day), then it falls under the NEDC scheme. The calculation is based on CO2 emissions.
- For other vehicles, the calculation is based on tax power (tax horses).
Carbon dioxide (CO2) emission rate | Tariff applicable to vehicles covered by the new registration system (WLTP) | Tariff applicable to vehicles not covered by the new registration system (NEDC) |
|---|---|---|
Up to 20 g/km | €0 | €0 |
From 21 to 50 g/km | From €17 to €40 | €1 per g/km |
From 51 to 60 g/km | From €41 to €48 | €1 per g/km |
From 61 to 100 g/km | From €49 to €150 | €2 per g/km |
From 101 to 120 g/km | From €162 to€192 | €4.5 per g/km) |
From 121 to 140 g/km | From €194 to €392 | €6.5 per g/km |
From 141 to 150 g/km | From €409 to€600 | €13 per g/km |
From 151 to 160 g/km | From €664 to €1,168 | €13 per g/km |
From 161 to 170 g/km | From €1,224 to €1,751 | €19.5 per g/km |
From 171 to 190 g/km | From €1813 to €3116 | €19.5 per g/km |
From 191 to 200 g/km | From €3,190 to €3580 | €19.5 per g/km |
From 201 to 230 g/km | From €3618 to €4968 | €23.5 per g/km |
From 231 to 250 g/km | From €5036 to €6,250 | €23.5 per g/km |
From 251 to 269 g/km | From €6325 to €7747 | €29 per g/km |
Greater than or equal to 270 g/km | €29 per g/km | €29 per g/km |
FYI
The tariff applicable to vehicles covered by the new registration system (WLTP) shall be a tariff fixed per gram. One list of tariffs applicable to vehicles covered by the new registration system (WLTP) is available.
The price depending on the fiscal power concerns vehicles which do not fall within the other 2 categories above:
Fiscal power (in horsepower, CV) | Rate |
|---|---|
Up to 3 | €750 |
4 to 6 | €1,400 |
7 to 10 | €3,000 |
11 to 15 | €3,600 |
From 16 | €4,500 |
Annual seniority tax
This scale takes account of the differences in the levels of pollution emitted by vehicles according to their type of engine and according to their year of entry into service, in particular for diesel vehicles.
Year of entry into service | Gasoline and similar | Diesel (diesel) and similar |
|---|---|---|
Until 31 December 2000 | €70 | €600 |
2001-2005 | €45 | €400 |
2006-2010 | €45 | €300 |
2011-2014 | €45 | €100 |
From 2015 | €20 | €40 |
The vehicle registered from March 2020 that combines electric and diesel is treated as a diesel-only vehicle when they emit more than 120 g/km of CO2.
Other vehicles that combine electric and diesel shall be treated as a diesel-only vehicle when they emit more than 100 g/km of CO2.
Example :
One company has owned since the 1ster january 2014 a diesel vehicle entered into service on 30 june 2009. It emits 230 grams of CO2per kilometer. It is not part of the new registration system.
- Annual tax on CO2 : 230 g CO2 per kilometer x 23,5 (rate applicable to vehicles emitting between 200 and 250 CO2/km) = 5405
- Annual seniority tax: annual amount due under the tariff for diesel vehicles put into service from 2006 to 2010 = 300
- Total: 5405 + 300 = 5705
The annual amount due for this vehicle is €5,705.
Rebate if the company grants reimbursement of mileage
In the case of vehicles owned or hired by employees or managers entitled to reimbursement of mileage costs:
- A weighting factor is applied to the standard tariff according to the number of kilometers reimbursed by the company to each employee or manager.
- A reduction of €15,000 is then charged on the total amount of tax due on all vehicles owned or leased by employees or managers of the company.
Coefficient applicable to the settled tariff | |
|---|---|
Up to 15,000 km | 0% |
From 15,001 to 25,000 km | 25% |
From 25,001 to 35,000 km | 50% |
From 35,001 to 45,000 km | 75% |
From 45,001 km | 100% |
Example :
A manager uses a vehicle for business purposes for 16,000 km a year. The weighting factor of 25% on the cost of the tax must then be applied, and then € 15 000 deducted from this amount. If the result is less than zero, the tax due is zero.
Please note
This reduction shall be subject to de minimis aid regulation. The thresholds set out in the table above in the chapter on exemptions apply.
VAT taxation system
As regards the reporting formalities and the payment of the annual CO₂ emissions levy and the annual vehicle age levy, these depend on the company’s VAT system:
- The persons liable to pay the normal effective taxation system or the persons not liable for VAT must declare the taxes on the Form No. 3310 A, annex to the VAT return. This schedule must be filed in January following the tax period.
- The persons liable to pay the simplified VAT system must report taxes on the form no. 3517 which must be filed in respect of the financial year in which the tax became chargeable. This form must therefore be submitted within 3 months of the end of the financial year if it does not end on 31 December or the May 3 in other cases.
Declaration and payment shall be made exclusively by electronic channel on the tax website.
Please note
Calculation support sheets (Form #2857-FC-SD and Form #2858-FC-SD) are available on impots.gouv.fr. These forms may, where appropriate, be requested by the tax authorities.
Exemption from declaration
The company shall be exempted from this declaration where the amount of the mileage reimbursed is less than or equal to €15,000.
It is also valid when the amount of tax due is nil (equal to zero). Failure to make a declaration shall be deemed to constitute an assessment of that tax.
Obligation to draw up a recapitulative statement of affected vehicles
Companies must now keep, for each of the charges for which they are liable, an annual summary statement of the charges for the economic use of the vehicles assigned to their activity.
This summary report shall also list the following information for each affected vehicle:
- Technical parameters (engine...)
- Date of first registration and date of first registration in France
- Assignment Terms
- Assignment periods.
The purpose of the recapitulative statement is to collect the information necessary for the calculation of taxes on the economic use of vehicles. It must be up to date by the date of the declaration. The tax authorities may have access to them if necessary. This status will be communicated to him at the first request of the administration.
Please note
Exempt vehicles must be presented separately by reason of exemption.
Taxes on the use of vehicles for economic purposes (including Article L421-94 defining the 2 taxes)
Definition of the different categories of vehicles (M1, N1, etc.)
Directorate of Legal and Administrative Information (Dila) - Prime Minister
Ministry of Finance
Ministry of Finance