---
title: Fiscal deductibility of vehicle costs in Muto
description: How are Fiscal deductibility of vehicle costs calculated in Muto
---
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# Fiscal deductibility of vehicle costs in Muto
### What is tax deductibility of car expenses?
Tax deductibility determines which part of your car expenses is deductible in corporate income tax.
In Belgium, specific rules apply to **passenger cars**. The deductible percentage depends on the vehicle’s characteristics and the relevant reference date. For other assets (e.g. LCVs) and non‑Belgian vehicles, Muto applies **100% tax deductibility** by default.
**Key points**
- Applies to: Passenger cars with country of registration = Belgium
- Time‑based: the percentage can change over time
- Determined by: CO₂ emissions, powertrain, legal regimes, and reference dates
- Muto automatically shows and uses the correct percentage per cost line
---
### Belgian legislation: concepts and logic
#### 1) Time dependency: percentage per booking date
The legal deductibility is **time‑based**: for each cost, the percentage that applies is the one linked to the **booking date**.
One vehicle can therefore have multiple periods with different percentages. Muto stores this in a **timeline** and applies the correct rate to each cost line.
#### 2) Parameters that determine deductibility
The most important parameters are:
- **CO₂ emissions** and **powertrain**
(e.g. petrol/diesel, PHEV, electric)
- **Country of registration**
(the Belgian rules apply only to vehicles registered in Belgium)
- **Reference dates** (see below): e.g. order date, first registration date, contract start date, or other dates defined by the user
#### 3) Contract extension and “matrix contract”
The tax regime that follows from the **order date** remains valid as long as all contract parameters are explicitly known and documented.
In the case of a **tacit renewal** (*without* reconfirming the parameters), a **new tax regime** may apply.
However, when a **matrix** is defined on the contract (so that all parameters remain known even after the official end date), a tacit renewal is **not** considered a change, and no new tax calculation is required.
---
### How Muto calculates tax deductibility
#### 1) Entry point in the menu
On the asset detail page (for Belgian vehicles only) you will see a tile **“Fiscal deductibility”**.
When you click this tile, a drawer opens showing:
- Vehicle parameters that influence deductibility (country, CO₂, powertrain)
- The set of **reference dates** used for the calculation
- A **table with periods** and their related deductibility percentages (only the change points)
#### 2) Managing reference dates
- Default reference date when a vehicle is created: the **order date**.
If that is empty, Muto uses the **first registration date**.
- You can add **extra reference dates** to recalculate the fiscal regime, for example:
- at the start of a new contract
- when transferring a vehicle between companies
- After you save a changed set of reference dates, Muto:
- requests a **new timeline** from our fiscal calculation service, and
- **recalculates** all non‑fixed costs
#### 3) Application to costs and **rejected expenses**
For each cost, Muto determines:
- the **tax deductibility rate**, based on:
- the **asset** (type and country of registration)
- the **booking date** (matched to the right period in the vehicle timeline)
- the **fiscal interpretation** of the **cost type** (see below)
- the **rejected expense**, calculated as:
> **(Cost amount + non‑recoverable VAT) × (100% − deductibility percentage)**
Muto automatically calculates these values for each cost line.
---
### Fiscal interpretation per cost type (Belgian rules)
In Muto, the field **“Fiscal Interpretation (BE)”** on the cost type defines how the deductibility percentage for that cost is calculated or limited. There are three categories:
#### 1) Standard
- The deductibility is taken **directly** from the vehicle timeline (per booking date).
#### 2) Fossil Fuel
- For passenger cars with:
- **order date after** 31/12/2022, and
- **powertrain = PHEV** (PHEVP or PHEVD)
certain cost types have a **maximum of 50%** deductibility.
- If the vehicle itself has a lower deductibility than 50%, the **lower vehicle percentage** applies.
- If the vehicle is more than 50% deductible, it is **capped at 50%** for these costs.
#### 3) Fully Deductible
- These costs are always **100%** deductible, e.g.:
- interest
- general mobility
- public transport
**Where do I find this interpretation?**
The fiscal interpretation is part of the cost type configuration in Muto and is used by the cost engine to determine the correct tax deductibility and rejected expense.
---
### Examples and practical cases
#### Case A — Standard maintenance cost
- Vehicle: Belgian passenger car, CO₂ = 120 g/km
- Cost type: MAIN (General Maintenance) → Standard
- Booking date: falls in a period with 67.5% deductibility
**Result**
- Cost deductible at 67.5%
- Rejected expense = (net amount + non‑recoverable VAT) × 32.5%
---
#### Case B — PHEV fuel cost after 31/12/2022
- Vehicle: Belgian passenger car, PHEV, ordered on 15/02/2023
- Cost type: FUEL (Fossil Fuel) → Fossil Fuel
- Vehicle timeline: 80% standard deductibility, but Fossil Fuel has a cap
**Result**
- Deductibility for this cost = **50%** (capped)
- Rejected expense = (net amount + non‑recoverable VAT) × 50%
---
#### Case C — Interest cost
- Cost type: INTE (Interest) → Fully Deductible
**Result**
- Always 100% deductible
- No rejected expense on this cost line
---
### Limitations and scope
- Muto does **not** provide detailed legal explanations of each legislative change in the user interface.
- Muto does **not** automatically add extra reference dates; managing reference dates is the user’s responsibility.
- The **calculation logic** for the percentages is handled by our **fiscal calculation service**; Muto consumes the resulting percentages.
- For **non‑Belgian** assets, Muto assumes **100%** tax deductibility.
- VAT deductibility is handled **separately** and is outside the scope of this article.
---
### Best practices for fleet and finance teams
- **Maintain reference dates** whenever contract conditions change
(new contract start, transfer, explicit parameter changes).
- When cost results look unexpected, **check the timeline** in the “Fiscal deductibility” drawer.
- **Choose the correct cost types**: this determines whether a cost falls under Standard, Fossil Fuel, or Fully Deductible.
- **Approval flow**: approve invoices only when:
- the correct vehicles are linked, and
- all relevant data is complete,
so that deductibility and rejected expenses can be calculated correctly.
---
### Frequently asked questions
**When do I see the “Fiscal deductibility” tile on my vehicle?**
The tile appears only for vehicles with country of registration = Belgium.
For non‑Belgian assets, Muto does not show this tile and treats costs as 100% deductible.
**What if my cost date falls outside the known periods?**
Muto applies the following rule:
- If the booking date is **before** the first known period, the **oldest known rate** is used.
- If the booking date is **after** the last known period, the **most recent rate** is used.
**Can I override the percentage manually?**
No. You manage the **reference dates**. Based on those dates, our fiscal calculation service recalculates the official percentages, and Muto applies them automatically.
**What happens after I change reference dates?**
Muto requests a new fiscal history from our fiscal calculation service, replaces the previous table, and recalculates all non‑fixed costs (including deductibility, fiscal reference date on the cost, and rejected expenses).
**How does Muto handle “Fossil Fuel” costs for PHEVs ordered after 31/12/2022?**
These costs are limited to a maximum of **50%** deductibility.
If the vehicle’s own deductibility is lower than 50%, Muto uses that lower rate.
If it is higher than 50%, Muto caps it at 50%.
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