What can a director deduct: phone, car, meals?

Quick answer. A director can deduct professional expenses (phone, car, meals) provided they are incurred in the company's interest and documented. Phone is deductible pro-rata professional use. A car requires choosing between actual expenses and mileage allowance, with depreciation caps based on CO2 emissions (article 39-4 CGI). Business meals are deductible except above the meal benefit threshold of €5.50 in 2026.

The deductibility of professional expenses rests on three pillars established by article 39 of the French General Tax Code (CGI): the expense must be incurred in the company's interest, it must be supported by documentary evidence, and it must be accounted for in compliance with general accounting rules. A director who meets only one of these three conditions risks a tax adjustment during an audit.

The applicable tax regime also depends on legal status. In a SARL or SAS subject to corporate income tax (IS), a director's personal charges are deductible only if reimbursed as expense recovery. Benefits in kind granted to the director are subject to social contributions. In a sole proprietorship (EI) or under self-employed status (BNC), actual expenses are deductible from the director's taxable income.

A professional phone subscription is a routine expense, rarely questioned during a tax audit, provided you can demonstrate that use is professional. Article 39 of the CGI accepts deductibility whenever the expense is incurred in the company's interest.

Case 1: exclusively professional phone#

The subscription, calls, and data allowances are 100 % deductible. The invoice must be in the name of the company or director with proof of professional connection.

Case 2: mixed-use phone (personal and professional)#

This is the most common situation. Two approaches:

1. Declare benefit in kind: the director declares personal use and the company records a benefit in kind (calculated forfaitarily) deducted from salary or managed through payroll. This approach is rarely questioned during an audit if the amount stays reasonable (less than €50 per month for a standard plan).

2. Proportional deduction: the company deducts an estimated percentage of the subscription (for example 60 % professional / 40 % personal). This approach requires more justification during an audit, but it is accepted if the percentage is reasonably documented.

Hayot Expertise advice. Isolate professional subscriptions on a dedicated line if possible. If use is mixed, document the pro-rata via a simple email to the accounting file indicating the estimated professional percentage. Documented justification is faster to defend than none.

This is where directors most often make mistakes. Two regimes coexist: actual expenses with strict depreciation caps, and the official mileage allowance.

Option 1: actual expenses with depreciation cap (article 39-4 CGI)#

The annual depreciation ceiling for a passenger vehicle depends on the vehicle's CO2 emissions. Four brackets apply in 2026:

Only the depreciation within the ceiling limit is deductible. A director buying a Mercedes GLE at €90,000 with a €9,900/year ceiling can only depreciate that limit annually, even if the car depreciates faster.

Option 2: mileage allowance (simpler accounting)#

Instead of depreciating, the director reports kilometers driven for professional purposes and applies the official impots.gouv.fr allowance. The rate varies by vehicle's fiscal horsepower and geographic zone (mainland France / Corsica / overseas).

For a 5-horsepower vehicle, the 2026 scale (not revalued this year) starts at €0.636/km for the first bracket (up to 5,000 km), then applies a tapering formula beyond; an electric vehicle gets a 20% uplift. The exact amount is calculated on the official impots.gouv.fr simulator. Compared with actual expenses, the mileage allowance is often more advantageous for low-mileage drivers and less so for high-mileage drivers.

Important rule: company-provided vs. personal vehicle#

If the company provides a vehicle to the director, the director must evaluate a benefit in kind (calculated on depreciation or rental value). If the director uses their own car for company business, they can request reimbursement on a forfait basis (mileage allowance) or for actual expenses (with receipts and documentation).

Real case (anonymized). A startup director used an electric vehicle (under 20 g CO2/km) for business travel, around 15,000 km per year. With actual expenses, the deduction stayed modest. Using the mileage allowance, uplifted 20% for an electric vehicle, the amount computed on the official simulator came out clearly higher. Conclusion: the mileage allowance was more advantageous, and we adopted it the following year.

This is an area where confusion abounds. Three situations must be distinguished.

Situation 1: business meals (client, prospect, partner)#

A restaurant meal with a client or prospect is a professional expense deductible from taxable income, provided the meal is reasonable (not a gourmet menu at €200 per plate) and documented by an itemized invoice with date, place, and names of attendees.

VAT on restaurant costs incurred for business purposes is in principle recoverable, provided the expense is professional and documented. By contrast, VAT on lodging for directors and employees remains excluded from the right to deduct, as do meals of a personal nature.

Reasonable business meal expenses are charged to account 6232 (Receptions) or 6251 (Travel expenses) depending on whether the meal is at the office or away from it.

Situation 2: director's daily meal at the office#

If the director takes a daily meal at the workplace (canteen lunch or company dining), the benefit in kind for meals is evaluated forfaitarily.

2026 URSSAF rate: the forfait value of the benefit in kind for meals is set at €5.50 per complete meal.

Partial exemption: if the director pays more than 50 % of this forfait value (more than €2.75 per meal), the benefit in kind is disregarded and generates no social contributions. If the contribution is less, the difference is subject to contributions (employer + employee).

Example: a director pays €3.00 per canteen meal → contribution > 50 % of €5.50 → benefit in kind nil → no contributions.

Situation 3: meals during professional travel#

A meal taken by the director during business travel and fully reimbursed by the company is not considered a benefit in kind. It is a travel expense charged to account 6251 and generates no social contributions. Required documentation: invoice + proof of travel (fuel, toll, hotel, meeting notice, etc.).

Salaried director (SARL, SAS/IS)#

The director is an employee. Benefits in kind (car, phone, meals) are subject to social contributions and reported on the payslip. The director's actual expenses (dedicated phone subscription, travel, business meals) are deductible only if reimbursed via expense report. No implicit director expense deduction applies.

Sole trader / micro-BIC#

Actual expenses cannot be deducted individually: the sole trader benefits from a 34 % forfait abatement (micro-BIC) or 50 % (micro-services). Expenses in phone, car, meals remain in gross revenue. No depreciation allowed. No VAT recovery.

Self-employed professional (BNC status)#

Actual expenses are deductible under article 92 of the CGI. A lawyer, consultant, expert who buys a car, pays a phone subscription, or entertains clients can deduct these expenses as professional charges, under the same conditions as above: documentation, professional character, regular accounting.

1. Forget the documentation#

A phone subscription invoice with no mention of the number or professional purpose can be rejected. An expense note for meals without amount, date, or client name will not be accepted. Document immediately, not in response to an audit.

2. Mix personal vehicle with benefit in kind provision#

If the company "provides" the director use of a personal vehicle, it is not a company-supplied vehicle: no benefit in kind to evaluate. However, if the company reimburses the director's documented actual expenses (fuel, maintenance, insurance pro-rata), this approach is accepted.

3. Exceed deductibility caps without evaluating benefits#

Reception expenses (client meals) are limited to 5 ‰ (five per thousand) of the previous year's pre-tax turnover (article 39-5 CGI). For a €1,000,000 revenue company: ceiling = €5,000. Beyond this, the excess is added back to taxable income.

4. Ignore VAT regime#

VAT on fuel, car maintenance and professional restaurant costs is recoverable. By contrast, VAT on lodging for directors and employees is not. On a mixed hotel-restaurant invoice (room + meals), isolate the flows to recover only the deductible VAT.

5. Convert personal expenses into professional deductions#

"I used my car to pick up my son at school then visit a client": the tax authority only recognizes the client trip. Discretionary director expenses (personal gifts, leisure subscriptions paid by the company) are systematically reclassified as benefits in kind or distributed income.

We regularly help directors discover, during tax filing or audit, that they were leaving 10–20 % of deductions on the table. Recently, a services company CEO bought a plug-in hybrid vehicle (20–60 g CO2/km, ceiling €20,300) but cautiously capped its deductible depreciation at the lower thermal-vehicle ceiling (€18,300), thereby giving up part of an otherwise deductible depreciation each year.

Our conviction: not deducting what is legally deductible amounts to accepting implicit taxation. Collectively, a 19–25 % corporate tax rate means each euro not deducted costs 19–25 cents in deferred tax. Over a 20-year operating career, oversights accumulate.

The key: documented traceability and annual revision of "mixed" items (phone, car, meals) before year-end.

Hayot Expertise advice. In January, create a summary file: list of professional subscriptions (phone, internet, software), actual vehicle mileage (annual logbook), and significant business meal invoices. This documented base will let you validate deductions in November before accounting close, and if audited, answer in one hour instead of three days.