TVS Guide: France's Company Vehicle Tax – Eligibility, Calculation, and Declaration

Companies owning or leasing passenger cars or multi-purpose vehicles in France must pay the TVS, or tax on company vehicles. This comprehensive guide covers everything you need to know.

Profit-making companies headquartered in France pay TVS annually on vehicles used for passenger transport. Here's a clear breakdown of how it works, from eligibility to payment.

Which Companies Must Pay TVS?

TVS applies to all for-profit companies registered in France that own, lease, or use passenger vehicles, regardless of legal structure or tax regime (income tax or corporation tax). Non-profits and unincorporated entities are exempt.

Taxable Vehicles Under TVS

TVS targets "passenger vehicles," including those registered in the company's name, provided to it, or leased with mileage reimbursements to employees, managers, or partners. This includes:

• Vehicles in the passenger car (VP) category;
• N1 multi-purpose vehicles for passengers, luggage, and goods (e.g., vans with multiple seats);
• Pick-up trucks with at least 5 seats and European body code "pick-up."

TVS Exemptions: Key Vehicles and Uses

Vehicles used solely for these activities are permanently exempt:

• Sales;
• Rental (if vehicle rental is the company's core business);
• Public transport;
• Driving instruction;
• Agricultural use;
• Exclusive commercial or industrial purposes.

Additional exemptions include electric vehicles emitting under 60 g/km CO2, wheelchair-accessible M1 vehicles, and hybrids combining electric with petrol, LPG, natural gas, or E85 engines (exempt from the first component).

How to Calculate TVS

TVS comprises two components:

• First component: Based on CO2 emissions for vehicles used/owned since January 1, 2006, first registered after June 1, 2004, and approved under Directive 2007/46/EC. Otherwise, use fiscal horsepower.
• Second component: Based on air pollutant emissions.

Total TVS is the sum of both. Refer to form 2855 instructions on impots.gouv.fr for rates. For employee-leased vehicles with mileage reimbursements, deduct €15,000 from the tax due.

TVS Declaration and Payment Deadlines

Declare and pay TVS in January of year N+1 for the period January 1 to December 31, year N. Procedures depend on VAT status:

• Non-VAT liable: Appendix 3310 A on VAT return; online declaration and payment.
• Simplified VAT: Form 2855-SD; paper declaration, pay by cash, transfer, or check.
• Normal real VAT: Annex 3310 A on VAT return; electronic declaration and payment.

Offset against business tax credits if available. Note: TVS is non-deductible for corporation tax but deductible for other regimes.

Need More TVS Guidance?

Contact your local Service des Impôts des Entreprises (SIE) or consult a certified accountant. Experts can handle declarations, social charges, payroll, legal advice, and more to ensure compliance.

Staying informed on TVS rules is crucial for French businesses managing fleets effectively.