European Union: Cross-Border leasing of cars-business opportunities

Abstract

In the case where a business that is leasing a car is established and uses the car in a country other than the country where the lease company is established, the lease is referred to as a cross-border lease. For value-added tax purposes, some EU member states treat any lease as the supply of a service. When the contract is categorized as a service, then the lease terms of the car are subject to VAT in the country where the leased company has established its business.