Buy a car on the company or private? What pays off more
Learn when it pays to buy a car on the company, the tax advantages, and when it's better to buy privately. Explained briefly and clearly.
Buying a car on the company can be a good decision, but only if it is used predominantly for business purposes. In that case, costs such as fuel, service, and insurance are recognized as a business expense, and it is possible to deduct part of the VAT, thereby reducing tax.
On the other hand, if the car is also used privately, an additional cost arises through a benefit in kind (primitak u naravi), which often cancels out the tax advantages. That's why buying on the company pays off most for entrepreneurs who have higher profits and a real need for a company vehicle.
If you use the car mainly privately or occasionally for business, it is often simpler and more cost-effective to use a private car and pay a mileage allowance (putni nalozi, locco driving).
Conclusion: A car on the company makes sense when it serves the business — otherwise, a private purchase is often a better choice.