Company car tax: what can we expect in 2023?

The government has announced the abolition of the TVS (tax on company vehicles) in 2023 and its replacement by two new taxes: the annual tax on CO2 emissions and the annual tax on vehicle age. What can we expect this year?

Two taxes based on TVS components

Prior to January 1, 2022, French companies were subject to a two-part TVS tax: one calculated on the basis of the vehicle's CO2 emissions or tax rating, and the other based on pollutant emissions determined from the date of entry into service. Commercial vehicles dedicated to the transport of goods were not concerned by this tax.

As payment of the TVS is deferred by one year, companies liable for the tax continued to pay the tax in 2022 for the 2021 tax period. As of January 1, 2023, the abolition of the TVS is more concrete. It has been replaced by two annual taxes. The first, the annual tax on CO2 emissions, takes into account the exact number of days the vehicle is used. The second, the annual tax on emissions of atmospheric pollutants, retains its scale. Its calculation is based on the year the vehicle was put on the road and the pollution levels emitted by the vehicle.

In practice, the abolition of the TVS will have limited impact on businesses. Indeed, the only real change is the switch from quarterly to daily calculation of the CO2 emissions tax in 2023. Until now, the first component of the company car tax was due for a quarter if the company already owned the vehicle on the 1st day of that period. From January 1, 2023, each day of ownership will count towards the new tax.

Declaration and payment of new taxes replacing TVS

The procedures for declaring and paying the CO2 tax and the tax on atmospheric pollutant emissions depend on the company's VAT system.

Companies subject to the actual tax system and those not liable for VAT must complete form n°3310 A and submit it in January following the tax period.

Companies subject to the simplified real tax regime must complete form n°3517 and submit it during the fiscal year in which the tax is due.

To avoid unpleasant surprises and ensure peace of mind in the course of their business, companies are well advised to entrust the accounting side of their business to an expert, who will take care of these formalities within the statutory deadlines.