Attention company vehicle users: Penalties are coming for off-hours use!

Ekonomim columnist Abdullah Talu stated that the Ministry of Treasury and Finance has recently been issuing tax penalties to a large number of businesses, citing the use of company vehicles by employees outside of working hours as the reason.

PENALTIES FOR USING COMPANY VEHICLES IN 'PRIVATE LIFE'

Accordingly, the Ministry of Finance has begun issuing tax penalties to companies that grant their employees permission to use company vehicles in their private lives, claiming that the "benefit provided is subject to income tax just like a salary."

"THIS IS SQUEEZING BLOOD FROM A STONE"

Commenting on the issue, Talu said, "In our opinion, the Finance Ministry's view is quite forced. It is exactly the kind of thing that is like squeezing blood from a stone!"

In his article, Talu used the following expressions: "As can be noticed from an examination of Article 61 of the Income Tax Law regarding wages, the definition of wages in the Law is very broad, and it is possible to include everything, both cash and in-kind, related to the employed persons in the definition of wages.

This is extremely problematic. Companies allocate vehicles to their employees who meet the conditions determined for the performance of their work and cover their expenses."

"NOTHING GOES INTO THE EMPLOYEES' POCKETS"

Stating that this is "entirely related to work and the performance of work," Talu continued: "Nothing goes into the employees' pockets. For this reason, these expenses should not be considered as a benefit provided to employees."

Talu also gave an example regarding the issue: "For instance, just as the allocation of mobile phones, computers, etc., to company managers and personnel for use in company business, and taking them home to use at home, is not considered a wage, vehicles allocated for the same purpose and used in company business should not be considered a wage on the grounds that they are taken home on weekends or used during holidays."

"Otherwise, everything related or unrelated to the interpretation can be included in the definition of wages," said Talu, warning, "It would be beneficial for companies that allocate vehicles to their managers and personnel to be a little more careful during this process."

"THE MINISTRY SHOULD RE-EVALUATE THIS SITUATION"

Offering a suggestion to the Finance Ministry, Talu noted the following: "Considering the regulation regarding the 70-30 restriction on passenger car expenses, it would be beneficial for the Ministry to re-evaluate its view that expenses for non-work use (commuting to and from work, weekend holidays, public holidays, etc.) of vehicles allocated to senior managers and personnel (sales, marketing, etc.) should be accepted as net wages and taxed accordingly."