How does depreciation of electric commercial vehicles work?
Depreciation of electric commercial vehicles works differently from traditional vehicles due to specific tax regulations and depreciation rates. Electric company cars can be depreciated faster, offer additional investment deductions and have different VAT regulations. The exact calculation depends on the purchase price, the depreciation method and the tax benefits that apply to your situation.
What does depreciation mean for electric commercial vehicles?
Depreciation of electric commercial vehicles is the reducing the book value annually of your vehicle in company records. This works differently from diesel or petrol vehicles because the government provides tax incentives for electric commercial vehicles with more favourable depreciation rules.
For traditional commercial vehicles, you usually depreciate over a five-year period at a rate of 20% per year. For electric commercial vehicles, accelerated depreciation options often apply. You can sometimes opt for a higher depreciation rate in the first few years, which immediately reduces your taxable profit.
For your accounting, this means that you cannot deduct the purchase cost all at once, but spread over several years. The depreciation counts as business expenses, so you pay less tax. With electric company cars, you can also benefit from additional investment deductions on top of the normal depreciation.
What tax advantages do electric commercial vehicles offer?
Electric commercial vehicles offer significant tax advantages compared to traditional vehicles. You get additional investment deductions, pay no BPM and benefit from VAT refunds for business use.
The main tax advantages are:
- Investment deduction of 25% on the purchase price (in addition to normal depreciation)
- No BPM levy on purchase (since 2025, BPM on fuel vehicles)
- Full VAT deduction on 100% business use
- Lower addition for private use (16% instead of 22%)
- Possibility of accelerated depreciation
These benefits make electric company cars more financially attractive, especially for entrepreneurs in higher tax brackets. The investment deduction means you can directly deduct an additional 25% of the purchase price from your taxable profit, on top of the normal annual depreciation.
How do you calculate the depreciation of an electric company car?
You calculate depreciation by taking the dividing purchase price minus residual value by the number of depreciation years. For electric company cars, you can choose between linear depreciation (the same amount every year) or degressive depreciation (higher rates in the first years).
Practical example of straight-line depreciation:
- Purchase price electric commercial vehicle: €40,000
- Estimated residual value after 5 years: €12,000
- Amount to be written off: € 28,000
- Annual depreciation: €28,000 ÷ 5 = €5,600
For example, with declining balance depreciation, you can depreciate 40% in the first year, 30% of the residual value in the second year, and so on. This gives you more tax advantage in the first few years, when your profits may be higher.
Don't forget to include the investment deduction: in the above example, you get an additional €10,000 (25% of €40,000) deduction in the year of purchase. This deduction is separate from normal depreciation.
When is an electric company car most financially beneficial?
An electric company car is financially most advantageous at high annual mileage, business use above 80% and when you fall in a higher tax bracket. The tax benefits then outweigh the higher purchase cost.
The best situations for electric commercial vehicles:
- Annual mileage above 20,000 km (lower mileage costs)
- Mainly city traffic and short trips
- Access to your own charging point or company charging station
- Taxable income above €37,000 (higher tax savings)
- Companies operating in environmental zones
For sole traders and small entrepreneurs with lower annual mileage, the higher purchase costs may not yet always outweigh the benefits. Therefore, always calculate the total cost of ownership over the entire period, including depreciation, maintenance, insurance and fuel or loading costs.
Logistics companies, installers and service companies with a lot of city traffic usually benefit the most from the switch to electric driving.
How Van den Hurk helps with electric commercial vehicles
We will help you with the complete switch to electric commercial vehicles with personal advice on tax benefits, financing options and finding the right vehicle for your business. With more than 60 years of experience, we understand exactly what entrepreneurs are up against.
Our support includes:
- Personal advice on depreciation and tax benefits for your situation
- Transparent calculation of total cost of ownership
- Flexible leasing and financing options, tailored to your cash flow
- Extensive range electric commercial vehicles of different brands
- Administrative support
We take the time to understand your business situation and calculate together what electric driving means for you. No surprises, but clear figures and honest advice on when electric is or is not the best choice.
Want to know whether an electric company car is financially advantageous for your business? Contact us for a no-obligation discussion about the possibilities and a tailor-made calculation.
