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Introduction to mileage and fuel expenses
Fuel expenses are only deductible if you have a short term rental car or a company car that is not used for personal trips. For situations where you drive your own car or borrow a car from a friend, you can compensate yourself through tax free mileage. However, if the company still pays for fuel, the car owner will need to be taxed for fuel benefits. This can be time consuming and often less economically attractive than taking the mileage deduction. Any mileage reimbursement that exceeds the amount accepted by the tax authorities will be taxed as salary.
The most common mistakes with mileage and fuel expenses
The most common mistakes:
- To pay fuel receipts with the company’s money as compensation for using a private or borrowed car for trips on behalf of the company.
- Not keeping a driving log and deducting mileage compensation for trips made on behalf of the company.
- Not deducting mileage compensation for business trips made with a car that you are paying taxes for benefits
Please check the Swedish Tax Agency’s general information on allowances and car allowances.
