Company Car Tax Calculator

How this is worked out

A German company car you may use privately is treated as pay. You do not receive money, but a geldwerter Vorteil is added to your taxable salary and you pay income tax and social contributions on it.

It is calculated from the gross list price — the German recommended retail price including VAT and factory-fitted options, as at first registration. Not what your employer paid, not the second-hand value, and discounts do not reduce it. A three-year-old car still uses its original list price.

Two parts are added every month:

1. Private use — 1% of the list price. Flat, regardless of how much you drive.
2. The commute — 0.03% of the list price per one-way kilometre. Note this applies whether or not you actually commute that often.

Electric cars get a large discount. A battery-electric car with a list price up to 100,000 is taxed at 0.25% instead of 1% — a quarter. Above that cap, and for plug-in hybrids meeting the emissions or range condition, it is 0.5%. The 100,000 cap applies to cars acquired from 1 July 2025; earlier cars keep the cap that applied when they were acquired, which was 70,000 from 2024 and 60,000 before that.

The commute method is worth checking. Instead of the flat 0.03%, you can use 0.002% per actual journey, capped at 180 journeys a year. The break- even is 15 commutes a month. If you work from home two or three days a week — which most office jobs now do — the per-trip method is meaningfully cheaper. It requires a dated monthly record and you cannot switch part-way through a year.

A worked example

A 52,000 petrol car, 22 km commute, taxed at a 42% marginal rate:

• Private use: 1% of 52,000 = 520
• Commute: 0.03% × 22 km = 343.20
• Added to taxable pay: 863.20 a month
• Costs you about 362 a month, or 4,350 a year

Now the same car as an electric vehicle:

• Private use at 0.25%: 130
• Commute at 0.0075%: 85.80
• Costs you about 91 a month — roughly 3,250 a year less

And with the per-trip method on the petrol car, commuting 8 days a month: the commute part drops from 343.20 to 183.04, saving about 67 a month. On the same car, same job, different paperwork.

What this doesn't cover

• The list price is rounded down to full hundreds and always uses the original German RRP, even for a used or imported car.
• The logbook method (Fahrtenbuch) is the alternative to all of this: record every journey and be taxed on the actual private share. It usually wins for people who drive very little privately, and it is a genuine administrative burden — a single gap can invalidate the whole year.
• The commute surcharge only applies to travel to your primary place of work.
• The 42% default is illustrative. Your real marginal rate depends on income, tax class and whether you are above the social contribution ceilings.
• Charging an electric company car at home, and employer-provided charging, have their own rules not covered here.
• The reduced electric rates are legislated to run to the end of 2030.

Common questions