Utilization is a sustainable and interesting alternative for the destructive treatment of volatile organic compounds due to avoided CO2 emission. This work concentrates on the development of active and sulfur-tolerant catalysts for the utilization of contaminated methanol. Impregnated and sol–gel prepared vanadia–zirconia and vanadia–hafnia catalysts were thoroughly characterized by N2 sorption, analytical (S)TEM, elemental analysis, XRD and Raman spectroscopy, and their performances were evaluated in formaldehyde production from methanol and methanethiol mixture. The results showed higher activity of the sol–gel prepared catalysts due to formation of mono- and polymeric vanadia species. Unfortunately, the most active vanadia sites were deactivated more easily than the metal-mixed oxide HfV2O7 and ZrV2O7 phases, as well as crystalline V2O5 observed in the impregnated catalysts. Metal-mixed oxide phases were formed in impregnated catalysts through formation of defects in HfO2 and ZrO2 structure during calcination at 600 °C, which was evidenced by Raman spectroscopy. The sol–gel prepared vanadia–zirconia and vanadia–hafnia catalysts were able to produce formaldehyde from contaminated methanol with high selectivity at temperature around 400 °C, while impregnated catalysts required 50–100 °C higher temperatures.