Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2017
Sales and Use Tax Annotations
330.0000 LEASES OF TANGIBLE PERSONAL PROPERTY—IN GENERAL—Regulation 1660
(b) RENTAL RECEIPTS—ITEMS INCLUDED AND EXCLUDED
330.3194 Charges Under Leases. A taxpayer leases automobiles and makes the following charges:
(1) Excess mileage fee: assessed for excess miles driven by lessee over a predetermined standard.
(2) Renegotiation fee: assessed at the time the lessee signs a new lease agreement covering the same vehicle under a prior agreement. This is a flat rate documentation fee.
(3) Documentation fee: assessed at the time the lease is signed as a fee for processing the lease.
(4) Assumption fee: assessed if the lease is assigned by the lessee to another party.
(5) Deferral fee: assessed if lessee wishes to extend the lease for a short period of time without signing a new lease agreement.
(6) Late charges: assessed for failure to return the vehicle timely upon termination of the lease.
These are all payments required by the lease. Therefore, these charges are subject to tax.
A payment made by the lessee for failing to return the vehicle when due is a charge for use of the vehicle and also is subject to tax. 2/5/87.