Omnibus Decree

Company cars: taxation returns to the flat-rate system

The amendment to the tax reform reinstates the previous criteria with effect from 1 January 2026

by Stefano Sirocchi

24 June 2026

3' min read

Translated by AI

Versione italiana

Key points

What does the change involve?
Broadcasts
Vehicles ordered by 2024 and 2025
Increase in the benefit

3' min read

Translated by AI

Versione italiana

The draft legislative decree amending the tax reform, approved at first reading by the Government on 10 June, provides significant relief for businesses with company cars allocated to employees as fringe benefits. In particular, to determine the taxable income for the employee in the case of a vehicle provided for mixed use – that is, for both business and private purposes – the system reverts to the flat-rate method, even for cases that had previously caused considerable operational difficulties due to the need to apply the market value.

What does the change involve?

The new wording of Article 51(4)(a) of the Tuir provides that, for motor vehicles, motorcycles and mopeds made available for mixed use, the following shall be assumed: 50 per cent of the amount corresponding to a standard mileage of 15,000 kilometres, calculated on the basis of the ACI cost per kilometre, net of amounts deducted from the employee’s pay, including those relating to accessories and fittings. The coefficients of 20% and 10%, instead of 50%, remain in place for plug-in hybrid and purely electric vehicles respectively.

Consequently, both the reference to ‘new registration’ and that to contracts entered into from 1 January 2025 are no longer applicable. To apply the rules, which will come into force retroactively from 1 January 2026, it is sufficient for the vehicle to be made available for mixed use and, therefore, physically handed over to the beneficiary employee from that date.

Programmes

This is without prejudice to the application of the legislation previously in force, based on the associated coefficients to CO2 emissions (from 25% to 60%), for vehicles granted for mixed use from 1 July 2020 to 31 December 2024, as well as for those ordered by employers by 31 December 2024 and granted for mixed use in the first half of 2025, pursuant to the transitional provisions (Article 1, paragraph 48-bis, of Law 207/2024).

Vehicles ordered by 2024 and 2025

Not only that, but the draft legislative decree extends the period for the allocation of vehicles ordered by the end of 2024 to cover the whole of 2025, and, in addition, allows the employer to continue applying these rules even if the vehicle is reassigned to another employee.

From this year onwards, even vehicles ordered and made available for use during 2025 are not excluded from the flat-rate scheme: more generally, and by express provision, vehicles granted in 2025 that do not fall under the transitional regime mentioned above (including the time extension) are subject to the new rules based on the vehicle’s fuel type.

Increase in benefits

It is also provided that the value of the fringe benefit shall be increased by 50% after 31 December of the fifth year following the year of first registration. This increase also applies to the current tax year, as it is applicable to the transitional rules as well as to those due to be introduced from 2026. To clarify the calculation method, vehicles registered this year will be subject to a 50% increase in the taxable value of the fringe benefit – determined on the basis of coefficients linked to the type of fuel – with effect from 1 January 2032.

Furthermore, for accessories or fittings not included or valued in the ACI tables and not purchased directly by the employee, the benefit must be increased by 5 per cent. This increase applies under both the new and transitional regulations. However, arrangements in place up to 31 December 2025 remain unaffected, with no possibility of a refund for any additional tax that may have been paid.

It remains to be clarified whether the wallbox provided by the employer can be included in the 5% flat-rate surcharge provided for accessories and fittings not valued in the ACI tables, as it constitutes infrastructure external to the vehicle but functionally linked to the use of electric and plug-in hybrid vehicles.