Car insurance it can no longer be fully deducted when filing your tax return using form 730. Until 2014, however, it was possible to download the entire cost of the policy you took out, regardless of whether it was a car for personal or business use. With the new legislation, however, it is possible to deduct only 19% and exclusively from insurance policies which also protect the person from the risk of death or permanent disability.
What can you download with the 730 car insurance?
Starting from 2014 it is no longer possible to download car insurance through the 730 form due to the Legislative Decree no. 102 of 2013converted into law with L. n. 12 of 2014. Previously, it was possible to deduct the portion of the RCA premium relating to the contribution to the National Health Service (NHS), equal to around €10. However, this possibility was canceled for two main reasons:
- on one side a space has been made tax reasonlinked to the attempt to simplify our country’s tax system;
- on the other, a series of have been adopted austerity measuresincluding this one, to reduce public spending.
To date it is possible to deduct 19% of the expenses incurred for insurance policies that provide for risk of death you hate permanent disability not less than 5%, from any cause arising. In other words, therefore, you can download the:
- driver’s accident policies, which covers the driver in the event of death or permanent disability in the event of a serious road accident;
- death risk, which covers the policyholder’s family members in the event of sudden death;
- permanent disability, in favor of the policyholder who could become disabled due to a serious accident while driving.
How much do you charge for car insurance?
Once the types of policies that can be deducted from the 730 have been clarified, it is appropriate to underline the limits of the deduction: the maximum amount is €100.70.
Furthermore, in order to actually download this type of car insurance, the individual must have a maximum income of €120,000keeping in mind that the maximum amount progressively decreases for incomes above this ceiling until it reaches zero for those above €240,000.
To better clarify what and how much can be downloaded in 730 of the car declaration, a description is given below example: if Maria Rossi has an income of €100,000 and has paid an insurance premium of €500 for a driver’s accident policy, she can deduct 19% of €500, or €95. Antonella Bianchi, on the other hand, has an income of €150,000 and has paid an insurance premium of €500 for a driver’s accident policy, you can only deduct part of the amount. The precise deductible amount depends on your specific income and must be calculated using the formula in the 730 instructions.
The deductibility of company car insurance
Company car insurance can be considered as a deductible cost for tax purposes for businesses and freelancers who use the vehicle for purposes related to work (in fact, we speak of instrumental good). This means that expenses incurred for company vehicle insurance can be deducted from business or professional income to reduce taxable income.
For businesses, car insurance deductibility is based on the direct correlation between the use of the vehicle and the activity performed. Insurance costs are fully deductible if the vehicle is used exclusively for business needs. In the event that the car is also used for private purposes, the deductibility can be limited or proportionate based on the degree of actual use for the work activity.
Then regarding the car insurance deduction with VAT number, freelancers can deduct the costs when calculating their professional income, provided that the car is used mainly for needs related to the exercise of the profession. It is essential that there is adequate documentation certifying the professional use of the vehicle to justify the tax deduction.
Can I download the car tax?
The car tax can be deducted in the tax return, under certain conditions, as it is among the deductible or deductible expenses depending on the specific use of the vehicle. For private individuals, car tax is generally not deductible in 730, as it is considered a personal tax relating to vehicle ownership and not a cost incurred to produce income.
However, for vehicles used in the exercise of business, professional or agricultural activities, the tax can be deducted as an operating cost. In these cases, the cost of the car tax can be entered in the 730 form or in the Unico form for VAT holders, depending on the tax situation of the taxpayer.
