If we resign from the option of full deduction of VAT on vehicles, the undeductible VAT becomes our tax deductible cost for income tax purposes. This qualifiaction of VAT is, however, dependant on the fact that we use the vehicles for business purposes.
Tax authorities say, in some of their official rulings, that even theoretical possibility to use the vehicles for non-business purposes can make the VAT cost questionable. This theoretical possibility can be established by tax authorities on the basis of internal company rules - if they allow for private use of the vehicles, VAT will not be a tax cost.
