The Government announced by surprise a few days ago new aid for the purchase of an electric car, consisting of a deduction of 15% in Personal Income Tax (IRPF).
After the publication of the measure in the Official State Gazette, we already know the exact scope and the requirements to qualify for this new tax deduction.
From the outset, it should be clarified that these aids will apply to both new and used cars that are electric and PHEV plug-in hybrid cars and, merely anecdotally, to FCV hydrogen fuel cell cars.
We explain how to access this help if you decide to buy an electric car between now and December 31, 2024.
The aid consists of "a deduction of 15% of the purchase value of a new electric vehicle", as long as a series of requirements are met regarding the payment of the car and the type of vehicle.
Vehicle Payment
The car must be purchased and its payment completed between
June 28, 2023, and December 31, 2024. "In this case, the deduction will be
made in the tax period in which the vehicle is registered."
Or, 25% of the purchase value of the vehicle must be paid
between June 28 and December 31, 2024. In this case, the deduction will be made
in the income statement corresponding to the year in which it was made. paid
that amount. But with the condition of paying the rest and finalizing the
purchase of the vehicle before the end of the year following the one in which
25% was paid.
On a practical level, it does not mean that we have to pay outright for a new car. You can continue financing, since in these cases the financial institution pays the dealer and the car is considered purchased, even if we do not resolve the credit there is a reservation of title.
How much can I deduct?
In both cases, the maximum base of the deduction will be 20,000 euros and will be made up of the purchase value of the vehicle, including the expenses and taxes inherent to its purchase, such as registration tax.
But be careful, the BOE reminds us that it will be necessary to "discount those amounts that, if applicable, have been subsidized or will be subsidized through a public aid program." In other words, the aid from the MOVES III Plan will continue to be taxed in personal income tax in the event that we buy the car requesting this aid.
The amount of this deduction "will be subtracted from the full state fee" after the other deductions provided by the Treasury, such as donations to NGOs or investment in the creation of a company.
At a specific level, it means that we can deduct a maximum of 15% of 20,000 euros, that is, 3,000 euros, from the full state fee. Let us remember that once all possible deductions have been applied to the full state and regional quotas, we obtain the liquid state and regional quota. The sum of these two installments is the final total amount that we will have to pay to the Treasury.
Summarizing and at a practical level to understand each other, it is a deduction of 3,000 euros and it is applied in the same way as if we had donated 3,000 euros to an NGO.
Which vehicles are eligible for this help
Any car (maximum of nine seats and less than 3,500 kg of MMA) new or second-hand intended for private use and that is a ZERO label according to the DGT. That is a battery electric car, a hydrogen fuel cell electric (FCV), an extended range electric (EREV), such as a Mazda MX-30 R-EV, or a plug-in hybrid PHEV with more than 40 km of approved electric autonomy.
Also eligible for this deduction are L6e light quadricycles (electric cars without a license) and L7e heavy quadricycles, such as the Citroën AMI. So are motorcycles, with two and three wheels, of more than 50 cm3.
There is also a deduction for private charging points
In addition to the purchase of an electric or PHEV, whoever installs a charging point in their home or parking lot will be entitled to an additional deduction of 15% of the full state income tax rate based on the price of the installation, with a cap for the calculation of 4,000 euros, which would be a maximum of 600 euros.
The same conditions apply to the purchase of a car, namely, the payment between June 28, 2023, and December 31, 2024, and if it is installed with aid from the MOVES III Plan, these will be taxed. In addition, the installation must be completed before December 31, 2024, and in case of paying it in cash, it cannot be deducted from personal income tax.
Anything else to keep in mind?
If after buying the car or the installation, they become
affected by an economic activity, "the right to the deduction practiced
will be lost". That is, if that change occurs after having enjoyed that
deduction, you will have to make a complementary statement to "repay"
that aid.
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