This article analyses an issue that has recently come to the fore, namely the VAT treatment of mixed-use vehicles provided by the company. This is due to the difference in criteria that has long existed (and still seems to exist) between the Administration and the Courts.
It should therefore be recalled that the controversy dates back to a long time ago, but that it has resurfaced as a result of the publication by the AEAT of the Note of 28 July 2023, in which, with the intention of unifying criteria and based on a rule of availability of mixed-use vehicles assigned to employees, which is set at 80-20 (80 for private use and 20 for business use), it has understood that, in order for the VAT on the acquisition/renting/leasing of vehicles leased by employers to their employees to be 100% deductible, the employer must charge them the corresponding VAT on the private use, since this operation is a transaction subject to VAT, as long as the employee pays a fee for such use or waives part of his or her salary in return. Otherwise, the deductibility is subject to the 80-20 rule mentioned above.
Well, with the AEAT Note in hand, last February there was some “media noise” as a result of a pronouncement by the Supreme Court (Ruling of 29 January 2024 Appeal 5226/2022), which led some forums to interpret it as undermining the AEAT Note regarding the presumption of availability of mixed-use vehicles (80-20), thus shielding the 50-50 presumption that, for VAT purposes, is included in Article 95 Three 2nd of the VAT Act.
In our opinion, although the ruling is positive, we do not share the opinion that the Supreme Court “shields the 50% VAT deduction”, since the specific matter referred to the High Court’s decision was the question of whether or not to charge VAT to the employee, and there is no change in this respect compared to the AEAT note.
It is true that the specific circumstances of the inspection (background of the judgment) include the fact that the company had deducted 50% of the VAT, in line with the presumption contained in the VAT Act, but, from our point of view, the Supreme Court does not rule on this issue. We can say that, in a way, it assumes this, but for different reasons, perhaps more to do with the fact that the inspection did not go into assessing this issue at the time because it did not have to.
The interpretation of the judgment can be enforced in defence, but we do not agree that there is a 50% VAT deduction shield.
For the time being, the jurisprudential evolution of this matter will have to be followed closely, but it seems that the position of the Tax Administration is to maintain its criterion.
