# Driving a company car

If you and your family make use of an employer-provided motor vehicle (a car, van etc.), this is considered a taxable benefit offered to you by your employer. Its value is taxed in the same way as your wage income is taxed.

The company-car benefit is either full type or limited type. The first alternative, (vapaa autoetu; fri bilförmån) the unlimited benefit means that your employer pays all car expenses. The second alternative, (auton käyttöetu; förmån att använda bil) the limited type of the benefit, means that you must at least pay for the fuel and the recipient of such payments must not be your employer i.e. you must pay the fuel expenses to a third-party supplier.

The tax office may raise the value of your company car benefit if private kilometres exceed 18,000 per year.

### Commuting

Although you might drive the company car to work every day, you are only entitled to claim expenses according to what the commuting would have cost you by the least expensive means of transportation. Public transport is usually the least expensive. However, if the least expensive means of transportation is the company car (limited/unlimited type), the basis for the deduction is €0.19 per kilometre.

File trips between your home and the workplace under

• Travel expenses – Commuting expenses (A).

This is treated as private driving. Consequently, these kilometres are included in the taxable benefit value.

Illustration: Mika lives in the commune of Juva but his job is located in Varkaus. He drives to work. His employer has given him a company car. Mika claims his commuting expenses accordingly, using the basis for the deduction for driving a company car. His daily round-trip commute is 75 kilometres. He has claimed €4,537,50.

However, he could buy a monthly ticket for the public transportation service between Juva and Varkaus. The price of an unlimited-fare ticket is €290.10 per month.

Mika has one month off every year, so the calculation must be based on 11 months instead of twelve: 11 × €290.10 = €3,191.10.

The commute causes a total of 18,150 kilometres of private driving for Mika ( = 75 Km × 22 days × 11 months). The kilometres driven for private purposes constitute an employer-provided fringe benefit, taxed in the same way as wage income.

## Travelling to a secondary place of work

### Expenses for the trips from home, or from the primary place of work, to a secondary place

If you have driven your company car to the destinations and you have an unlimited-type company car arrangement, you get no deductions because the trips do not cause you any expenses. The kilometres driven for work purposes are, of course, not included in your fringe benefit calculation.

If the company car arrangement you have is the limited type (auton käyttöetu; förmån att använda bil) and your employer has not paid you tax-exempt reimbursement for travel expenses, you get a deduction. In these circumstances, your travel and commuting are deductible as expenses for the production of income. In 2021, the deduction amounts to €0.10 per kilometre unless you give details on your car expenses proving otherwise.

File trips by company car (limited type) under

• Travel expenses − Travelling to a secondary place of work (D).

Driving for work purposes is not included in your fringe benefit calculation.

### Commuting between a place of accommodation and the secondary workplace

The commuting between where you stay overnight and where you work at the location of your secondary workplace causes deductible expenses, which you may claim in the usual way, as commuting expenses. You must claim them by the least expensive means of transportation. However, if the least expensive means of transportation is the company car (limited/unlimited type), the basis for the deduction is €0.19 per kilometre.

File trips between a secondary workplace and the place of accommodation under

• Travel expenses − Commuting expenses (A).

This is treated as private driving, in other words, kilometres that we include in your fringe benefit calculation when assessing the annual taxable value of your having the company car.

## Going to a special place of work

If you have driven your company car to the destinations and you have an unlimited-type company car arrangement, you get no deductions because the trips do not cause you any expenses. The kilometres driven for work purposes are, of course, not included in your fringe benefit calculation.

If the company car arrangement you have is the limited type (auton käyttöetu; förmån att använda bil) and your employer has not paid you tax-exempt reimbursement for travel expenses, you get a deduction. In these circumstances, your travel and commuting are deductible as expenses for the production of income. In 2021, the deduction amounts to €0.10 per kilometre unless you give details on your car expenses proving otherwise.

File trips by company car (limited type) to a special place of work under

• Expenses for the production of income (unless your employer has covered them).

Driving for work purposes is not included in your fringe benefit calculation.

## Permanent job away from home and family

For tax purposes, you are treated as having a family if you are married or in a registered partnership, or if you live together with a partner with whom you have a child, or have had a child in the past.

The daily commuting between where you stay overnight and where you work at the location of your permanent job causes deductible expenses, which you may claim in the usual way. You must claim them by the least expensive means of transportation. If the least expensive means of transportation is the company car, the basis for the deduction is €0.19 per kilometre.

File trips within the municipality where you work under

• Travel expenses – Commuting expenses (A).

This is treated as private driving, in other words, kilometres that we include in your fringe benefit calculation when assessing the annual taxable value of your having the company car.

Going home on days off to see your family (normally for the weekend i.e. once a week) causes deductible expenses, which you may claim up to the amount it would have cost you by the least expensive means of transportation. If the round trip home can be done for the weekend riding on public transport, you must report the cost of the tickets as your expense. However, if the least expensive means of transportation is the company car, the basis for the deduction is €0.19 per kilometre.

File trips home to your family under

• Travel expenses – Going home for the weekend (B).

This is treated as private driving, in other words, kilometres that we include in your fringe benefit calculation when assessing the annual taxable value of your having the company car.

## Permanent job located far away from home — no family

The daily commuting between where you stay overnight and where you work at the location of your permanent job causes deductible expenses, which you may claim in the usual way.  You must claim them by the least expensive means of transportation. If the least expensive means of transportation is the company car, the basis for the deduction is €0.19 per kilometre.

File trips within the municipality where you work under

• Travel expenses – Commuting expenses (A).

This is treated as private driving, in other words, kilometres that we include in your fringe benefit calculation when assessing the annual taxable value of your having the company car.

If you are treated as having no family, you cannot get deductions for going home for the weekend.

## Temporary job located far away from home

If you work at another location and the job is temporary, your family situation has no effect on the expenses you are allowed to claim.

### Going home during the assignment

If you have a job assignment in a different district and you go home for the weekend, you may claim the expenses by the least expensive means of transportation. If the round trip home on public transport can be done during the weekend, you must report the cost of the tickets as your expense. However, if the least expensive means of transportation is the company car, the basis for the deduction is €0.19 per kilometre.

File trips home under

• Travel expenses – Going home for the weekend (B).

This is treated as private driving, in other words, kilometres that we include in your fringe benefit calculation when assessing the annual taxable value of your having the company car.

### Going home if the assignment is interrupted

Reasons for interruptions include holidays or sick leave or situations where the employer has not made any arrangements for weekend accommodation.

If your assignment at the other location is interrupted, the expenses for going home are treated as those of a business trip. You cannot deduct them if your company car is under a fringe benefit contract known as an unlimited-type arrangement (vapaa autoetu; fri bilförmån). However, if you pay expenses yourself because your company car is a limited-type arrangement (auton käyttöetu; förmån att använda bil), you can deduct €0.10 per kilometre, provided that your employer does not pay you reimbursement for the business trip expenses.

File trips home by company car (limited type) under

• Travel expenses – Going home for the weekend (B).

Driving for work purposes is not included in your fringe benefit calculation.

More information on the Tax assessment of benefits-in-kind (fringe benefits) (see section 7 of this guidance, only in Finnish and Swedish).

More information on work at a special workplace (see sections 8 and 9 of this guidance, only in Finnish and Swedish).