Tax benefits of electric company cars: what you need to know

Since the end of 2024, the framework for electric vehicle purchase incentives for companies in France has changed profoundly. The ecological bonus has been removed for professionals, refocusing support on taxation and long-term cost optimisation. In 2026, it is therefore mainly tax benefits, tax exemptions and indirect mechanisms such as energy savings certificates (CEE) that make fleet electrification particularly attractive for companies.

What tax benefits are available to companies in 2026?

A tax benefit is an advantage granted by the State to reduce the amount of a tax. It can be granted for various reasons, such as encouraging certain behaviour. This is the case with leasing or buying an electric company car.

In line with the Mobility Orientation Law (LOM), which aims to make transport cleaner, and the decision to ban the sale of combustion-engine cars by 2035, the French State is encouraging companies to renew their vehicle fleet with electric or hydrogen vehicles. In 2025, this strategy was accompanied by structural tax measures and new obligations, such as the annual incentive tax on fleets (TAI).

Deductible VAT

VAT is said to be deductible when the company can recover a certain amount of it. It applies to business purchases, i.e. those that will be used by the company to produce a new good or service.

In 2026, VAT on the electricity used to charge business vehicles is fully deductible, provided that the expenses are properly allocated to the company's activity. A professional charging card brings these expenses together on a single invoice in the company's name, which makes VAT recovery easier. VAT on the purchase of passenger cars, however, remains non-recoverable, except for certain light commercial vehicles (LCVs).

Taxes on vehicles used for business purposes (formerly TVS)

Since 2022, the company vehicle tax (TVS) has been replaced by two annual taxes:

• The tax on CO₂ emissions
• The tax on air pollutants‍

Electric and hydrogen vehicles remain 100% exempt from both.

The vehicle registration tax

The price of a vehicle registration certificate in France is actually made up of several taxes:

• The regional tax, which differs from region to region.
• The professional tax, which applies to the purchase of a vehicle intended for public transport or the transport of goods.
• The ecological malus, which only concerns new and imported vehicles, and is based on CO2 emissions.
• The fixed tax of €11.
• The delivery fee, which covers the cost of sending the registration certificate, amounting to €2.76.  

In 2026, all regions in mainland France continue to exempt electric vehicles from the regional tax on the registration certificate. With no professional tax or ecological malus, the registration cost of an EV comes down to the fixed tax of €11 and the delivery fee of €2.76, a total of €13.76.

Depreciation of electric company cars

The last tax benefit is the depreciation of an electric company car. When a vehicle is acquired, its value is included in the company's expenses. Each year, this value depreciates until it leaves the expenses after 4 or 5 years.

The depreciation expense for a vehicle is deductible. For an electric vehicle, the ceiling is higher than for combustion-engine cars, reaching €30,000, which still applies in 2026.

As well as depreciating the vehicle itself, it is possible to depreciate 100% of an electric vehicle's battery. This means the price of the battery can be fully deducted from the company's taxable profit over its lifetime.

Thanks to all these tax benefits, it becomes more affordable to renew your vehicle fleet with clean vehicles. A change of behaviour that does not only have a financial impact.

What impact do tax benefits have on the cost of an electric vehicle?

As we have just seen, favourable taxation for electric mobility helps companies reduce their acquisition costs and optimise their tax expenses.

These advantages have a real influence on purchasing decisions and help increase the number of clean vehicles on the road. These vehicles will reach the used car market in a few years and be offered to private buyers.

But the impact of this taxation does not stop there. It also allows companies to commit to corporate social and environmental responsibility (CSR) and go further in their actions for the environment. As a first step in electrifying the vehicle fleet, it encourages companies to keep going.

Especially since an electric vehicle fleet is not only advantageous from a tax point of view.

Electric company vehicles: what other long-term benefits?

Beyond tax optimisation, switching to electric gives companies the opportunity to make additional, long-term savings.

Everyday savings

Although an electric car costs more to buy than a combustion-engine car, its long-term use reverses the trend.

As an electric vehicle has fewer mechanical parts, it needs fewer repairs and breaks down less often. This encourages insurers to offer cheaper insurance contracts.

Finally, electric charging costs less than petrol or diesel. Even more so when charging is done at home, at a charging station on promotion, or even free of charge!  

Tax benefits and purchase incentives: how can you combine them?

Tax benefits reduce the cost of an electric vehicle over time. They can be combined with other financial schemes available at the time of purchase or leasing. For a complete overview of the existing mechanisms, discover the 2026 electric vehicle purchase incentives for companies.

Conclusion

In 2026, taxation is a major lever for reducing the total cost of ownership of electric company vehicles. Combined with purchase incentives, these benefits strengthen the economic case for electrifying professional fleets.

For an overall view of the issues around electric company cars, discover our complete guide to making your electric transition a success in 2026.