Purchasing a trailer and deducting VAT – what does it look like?

When deciding to buy any product or service, we are forced to pay a price that takes into account not only its value, but also VAT. However, there are situations in which you can deduct this tax in full or at least partially. This includes, among others: owners of individual vehicles. Today we will try to explain, what is the VAT deduction when purchasing a trailer? and when exactly it can be done.

Can I get full VAT deduction when buying a trailer?  

Let's start with the fact that a trailer is not recognized by Polish law as a motor vehicle because it does not have an engine (Article 2, point 33 of the Act of June 20, 1997 - Road Traffic Law). Theoretically, the possibility of deducting VAT on its purchase should be considered differently than in the case of, for example, a passenger car. In practice, however, it turns out to be more complicated. Trailer it is a structure which, in principle, always needs to be attached to another vehicle. It is worth emphasizing that only few people actually have a chance VAT deduction from the purchase of a trailer Entire. This possibility occurs only in one situation - when it was purchased by a person who is an active VAT payer and intends to use it only to carry out taxable activities and additionally using a vehicle, the use of which also allows for the deduction of VAT in 100%.

How to use a company car and deduct VAT when purchasing a trailer

Only those who use it exclusively for business purposes can afford the above-mentioned VAT deduction in 100% from the use of a car. However, this is quite a rare situation. Most business owners decide to buy a car to use it not only privately, but also to make it easier to perform specific activities related to running the business (e.g. driving to the warehouse to pick up goods). This means that it is possible to deduct VAT not in full, but in 50%. Therefore, if a trailer is additionally attached to such a car, then there is also a chance of obtaining a VAT deduction at the level of 50%.

Is this a big benefit? Everyone must answer this question for themselves, while remembering one more important issue. What we mean here is the fact that the purchased trailer may be included in the company's fixed assets (which is important when trying to obtain a full VAT deduction) or directly as costs. But what does it depend on?

What conditions must a trailer meet to be classified as a fixed asset?

If we want it to be acquired trailers was included in fixed assets, several conditions must be met. The first of them is having the right to ownership or possibly co-ownership to it by a person who remains a taxpayer. Moreover, the trailer should be purchased by him on his own. It must also be a structure that does not have any deficiencies and is suitable for use on the day on which it was intended for use. The expected period of use for corporate purposes should be at most one year.

The trailer may be intended for use under an agreement other than a purchase and sale agreement, e.g. leasing, tenancy or rental. It is also important that the value of the fixed asset we are interested in here is higher than PLN 10,000. net in the case of active VAT taxpayers and PLN 10,000 gross for taxpayers not required to pay VAT. When the above-mentioned conditions are met, the purchased trailer should be included in fixed assets. Otherwise, the transaction will be included directly in costs.

Full deduction of VAT from the purchase of a trailer – possible, but difficult

To sum up, if we count on VAT deduction from the purchase of a trailer in its entirety, we must buy it "for the company" and classify it as a fixed asset, and then make sure that it is always attached to the car, which cannot be used only for private purposes, but also (or only) for company purposes. The most problematic thing is meeting the last condition, because it involves the need not only to include the car in the company's assets, but also to submit a VAT-26 form to the appropriate Tax Office, keep records of its mileage (so-called mileage) and prepare special regulations regarding the use of the vehicle. In other circumstances, however, we can count on VAT deduction up to 50% after purchasing the selected trailer.