Created by Lucas Luís at Wednesday, 9 April 2025
Is the purchase of a car included in the IRS?
If you're thinking of buying a car and want to understand whether or not this expense can help you when it comes to doing your personal tax return, this article is for you!
Let's get straight to the point: buying a car does not enter the IRS as a deductible expense. This means that even if you've invested thousands of euros in a new or used car, it won't bring you any tax benefits as an individual taxpayer.
Why is this? Because the Tax Authority considers the purchase of a car to be a personal investment and not a current consumption expense. And in the IRS, only certain categories of expenses can be deducted, such as health, education, housing, homes and invoices from specific sectors with VAT.
But be careful: there are exceptions, especially for individual professionals or businesspeople who use vehicles as part of their economic activity. In these cases, and only under certain conditions, there may be room to consider some expenses related to the car as a cost of the activity, but this falls into another sphere, more closely linked to corporate accounting (IRPJ).
So, if you bought a car and expected tax relief for that investment, the reality is that the IRS will not give you anything back for it. However, it is still important that you always ask for an invoice with NIF for expenses associated with the car, because other components, such as VAT on certain services or professional charges, may be relevant in other contexts.
If you are planning a purchase soon, it is a good idea to be well informed about the real costs of the car in the long term - insurance, taxes, maintenance - because then there may be ways to optimize your tax burden.
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Car maintenance and repair in the IRS: what can be deducted?
