Introduction
Providing a company car to an employee is a common practice among businesses. However, this in-kind benefit is subject to strict regulatory and tax rules under Greek law. As of January 1, 2024, new provisions have come into effect, impacting the taxation and application of this benefit. This article provides a detailed breakdown of the changes, complete with tables, examples, and practical applications.
What Is the In-Kind Benefit of a Company Vehicle?
The in-kind benefit refers to the use of a company-owned vehicle by an employee for personal purposes. While ownership remains with the company, the employee derives a personal benefit from its use—rendering it taxable income under Greek law.
Key Changes Effective 01.01.2024
The tax treatment of company vehicles has been revised. Major changes include:
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Adjusted tax rates based on the vehicle’s retail price before tax (RPBT)
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Depreciation based on vehicle age
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Clear separation of private vs. business use
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New restrictions and exemptions for specific vehicle categories
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Clarification of who is and isn’t affected by the new rules
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Increased RPBT threshold for business-use vehicles
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Employee-shareholder participation in lease costs
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Special treatment for zero or low-emission vehicles (≤50g CO2/km)
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Shared-use vehicles not assigned to specific employees
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Submission of in-kind benefit values to the tax authority
1. Adjustment of Tax Rates
Tax is now based on the vehicle’s RPBT, with the following brackets:
| RPBT (€) | Tax Rate (%) |
|---|---|
| 0 – 14,000 | 4% |
| 14,001 – 17,000 | 20% |
| 17,001 – 20,000 | 33% |
| 20,001 – 25,000 | 35% |
| 25,001 – 30,000 | 37% |
Example:
A vehicle with an RPBT of €18,000 is taxed as follows:
(€14,000 × 4%) + (€4,000 × 20%) = €1,360 added to the employee’s taxable income.
2. Depreciation Based on Vehicle Age
As of 2024, the taxable value of the benefit is reduced according to the vehicle’s age:
| Vehicle Age (Years) | Depreciation (%) |
|---|---|
| 0 – 2 | 0% |
| 3 – 5 | 10% |
| 6 – 9 | 25% |
| 10+ | 50% |
Example:
A six-year-old vehicle with an RPBT of €20,000:
Tax value: (€14,000 × 4%) + (€3,000 × 20%) + (€3,000 × 33%) = €2,150
After 25% reduction: €1,612.50 taxable income
3. Private vs. Professional Use
The new law requires a clear distinction between business and personal mileage. Employers must:
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Maintain detailed usage records
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Use GPS tracking to monitor vehicle movement
Example:
If an employee drives 20,000 km per year, of which 12,000 km are business-related, only 8,000 km are taxable as private use.
4. Exemptions and Limitations
From 2024, the following are exempt from tax:
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Vehicles with RPBT under €10,000
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Vehicles used exclusively for professional purposes, including:
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Cars assigned to employees like sales reps or technicians who travel frequently for business (tool cars), even outside work hours
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Test-drive vehicles from car dealerships
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Staff transport vehicles (e.g., minibuses)
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Vehicles for client/guest transfer (e.g., hotel shuttles)
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Courtesy vehicles from repair/service companies
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Airside vehicles at airports used for ground handling, VIP transport, or crew mobility
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Zero/low-emission vehicles (≤50g CO₂/km) may enjoy full or partial exemption
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Shared vehicles not assigned to individual employees
Example:
A delivery van used solely for logistics is not taxed, regardless of its RPBT.
5. Who Is Affected – And Who Is Not
Included:
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Employees receiving vehicles for mixed personal/professional use
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Corporate executives and directors with assigned cars
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Workers with vehicle agreements that allow personal use
Excluded:
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Professional drivers using vehicles strictly for work (e.g., taxis, buses, trucks)
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Employers who issue vehicles solely for work purposes
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Vehicles with RPBT below €10,000
6. RPBT Limit Increase for Business-Use Vehicles
As per Article 37(1) of Law 5135/2024 (Gov. Gazette A’ 147/16-09-2024), the RPBT threshold for exclusively professional-use vehicles has been raised from €17,000 to €20,000. This applies to all qualifying vehicles from the 2024 tax year onward, regardless of purchase date or prior assignment status.
7. Employee-Shareholder Contribution Toward Lease Cost
When an employee is also a shareholder or partner, they may contribute to the vehicle lease cost. This contribution reduces the taxable benefit—provided it is documented via receipts or contracts.
8. Zero or Low-Emission Vehicles (≤50g CO₂/km)
To promote environmentally friendly transport, vehicles emitting ≤50g CO₂/km may qualify for tax reductions or full exemption. If such a vehicle has an RPBT of up to €40,000, the entire benefit is tax-free. Only amounts exceeding €40,000 are taxed according to the standard brackets.
Example:
An electric car with an RPBT of €30,000 and 0g CO₂/km is fully exempt from taxation when used for approved purposes.
9. Shared Company Vehicles Not Individually Assigned
Vehicles that are shared among staff and not assigned to specific individuals are not considered in-kind benefits. Employers must maintain usage logs and ensure business-only use.
10. Reporting to Tax Authorities
Employers are required to report in-kind benefit amounts to the tax administration to pre-fill employees’ tax returns. This reporting must be completed by the end of the relevant tax year, following guidelines from the Independent Authority for Public Revenue (AADE).
Conclusion
This article outlines the comprehensive changes affecting company vehicle benefits in Greece as of 2024. Employers and employees must adapt to the new rules to remain compliant and avoid potential fines. Accurate documentation, usage tracking, and understanding of applicable exemptions are essential for proper tax handling.
If you’d like, I can turn this into a visual guide, employee handbook insert, or compliance checklist tailored for HR and finance teams.
