How to sell your personal vehicle to your company

Selling your car to your company: advantages and disadvantages

If you make little use of your personal vehicle, or if you have several, it may be worthwhile selling one to your company, since it will be responsible for all running and maintenance costs. On the other hand, don't forget that your company will have to bear the cost of the new registration and the annual company vehicle tax (TVS) if the vehicle sold is a polluting one.

Once the transaction has been completed, the car will appear on the assets side of the balance sheet under property, plant and equipment, and will be eligible for depreciation in accordance with the rules governing used goods.

Estimate the sale price of your personal vehicle to your company

This point must not be overlooked to avoid any risk of reassessment in the event of a tax audit. To do this, you need to use the estimated price of your vehicle on the second-hand market at the time you make the declaration of sale, taking into account any defects (bodywork condition, repairs to be carried out, imminent tire change, etc.). This means that the transfer price must be calculated in the same way as if you were selling your vehicle to a private individual.

Don't be tempted to overstate the value of your car, as the tax authorities could then consider the transfer as a gift. In this case, the hidden benefit you derive would be taxed personally on your income tax as income from movable capital. What's more, if the intentional nature of this overvaluation were to be demonstrated, you could be liable for a 40% surcharge under article 1729 of the French General Tax Code (CGI).

Good to know: if you continue to use this vehicle for personal travel, a benefit in kind will have to be determined. The same will apply if you transfer your personal car to your company free of charge, since the company will have to bear all the costs associated with its use. This benefit can be assessed in two ways: either on the basis of the expenses actually incurred, or on a flat-rate basis. It will be subject to social security contributions and income tax.

Take all necessary steps

You must complete a declaration of transfer and have a new vehicle registration document issued in your company's name.

Documents to be provided for the transfer

Here is the list of supporting documents you need to provide when you sell your car to your company:

• declaration of vehicle sale (cerfa form no. 15776*02) completed by the seller and the purchaser, even in the case of a gratuitous sale
• original registration certificate (carte grise) crossed out and signed by the seller
• certificate of administrative status (CSA), dated less than 15 days, confirming that the vehicle is not pledged and that no opposition can prevent its sale and new registration. If this is not the case, you must regularize the situation by removing the pledge or opposition, before you can sell your car.

If the vehicle is over 4 years old, you are required to produce proof of a roadworthiness test, unless the test was carried out within the last 6 months. If the vehicle is less than 4 years old, no roadworthiness test is required.

Documents required to obtain a registration certificate in your company's name

To obtain your new vehicle registration certificate (carte grise), you must provide :

• the application for a registration certificate, dated and signed by the person legally responsible for the company and bearing the company stamp
• an original K-bis extract from the company, less than 2 years old
• the old registration certificate crossed out by the seller, bearing the words "Sold on..." with the date and time of the transaction and the seller's signature
• the declaration of transfer signed and dated by the former holder of the registration certificate
• proof of roadworthiness test less than 6 months old, if the vehicle is more than 4 years old
• identification of the applicant, i.e. the company's legal representative
• proof of payment of the registration fee. The fee is the same as for a new registration, and the company bears the cost.

You will then receive a provisional registration certificate in your company's name, valid for one month.

Vehicle insurance

When you sell your car to your company, or give it away free of charge, you must inform your insurer. Your policy will be cancelled within 10 days of receipt of your letter.

You'll then have several options, bearing in mind that insurance must cover third-party liability for a company car. As with a personal vehicle, you can add optional cover to your contract, such as :

• coverage for damage to the vehicle
• the vehicle driver's personal guarantee
• breakdown assistance