Vehicle Rental Taxes

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A vehicle rental tax, to support capital investments in transit, was approved by the N.C. General Assembly and became effective January 1, 1998. The tax, levied by the Research Triangle Regional Transportation Authority operating as Triangle Transit, is imposed at the rate of 5% on the gross receipts derived by a retailer from the short-term or rental of U-drive-it vehicles and motorcycles in Durham, Orange, and Wake counties.

G.S. 20-4.01 U-drive-it Vehicles – The following vehicles that are rented to a person, to be operated by that person:

  • A private passenger vehicle other than the following:

    • A private passenger vehicle of nine-passenger capacity or less that is rented for a term of one year or more.

    • A private passenger vehicle that is rented to public school authorities for driver training instruction.

  • A property-hauling vehicle under 7,000 pounds that does not haul products for hire and that is rented for a term of less than one year.

  • Motorcycles.

Subject Businesses include, but are not limited to, the following:

  • Automobile Sales Dealers

  • Truck Sales Dealers

  • Trailer Sales Dealers

  • Automobile Rental Agencies

  • Truck Rental Agencies

  • Trailer Rental Agencies

  • Equipment Rental Agencies

  • Any other establishment, place of business or enterprise maintaining facilities, equipment, services or inventory for the lease of rental or any type or kind of short-term lease or rental of a vehicle.

Short-Term Lease or Rental
This applies to a lease or rental that is made under a written agreement to lease or rent property to the same person for a period of less than 365 continuous days.

General Filing Information
Retailers must complete a Registration Application to establish an account number for tax reporting purposes. Completed applications will be mailed to:

Triangle Transit Rental Vehicle Tax Division
P.O. Box 13787 RTP, NC 27709

For assistance in completing an application or questions regarding the Triangle Region vehicle rental tax, please call Triangle Transit at 919-485-7559. Once a tax account number is established, a Motor Vehicle Rental Report will be sent to the retailer for use in filing their monthly report. View a Motor Vehicle Rental Report.

Collection:

Monthly Revenues Filling Status Postmarked By
$50 or less Quarterly The 15th of the month following the quarter
$50 - $20,000 Monthly The 15th of the following month
$20,000 or greater Semi-monthly The 10th of the following month
$20,000 or greater Semi-monthly The 25th of the same month

 

  • A tax levied by the Authority under these Policies and Procedures shall be collected by the Authority but shall otherwise be administered in the same manner as the optional gross receipts tax levied by G.S. 105-187.5. Like the optional gross receipts tax, a tax levied under these Policies and Procedures is to be added to the lease or rental price of U-drive-it vehicle or motorcycle and thereby be paid by the person to whom it is leased or rented.

  • A tax levied under these Policies and Procedures applies regardless of whether the retailer who leases or rents the U-drive-it vehicle or motorcycle has elected to pay the optional gross receipts tax on the lease or rental receipts from the vehicle. As specified under section 5.4 of these Policies and Procedures, a tax levied under these Policies and Procedures must be paid to the Authority by the date an optional gross receipts tax would be payable to the Secretary of Revenue under G.S. 105-187.5 if the retailer who leases or rents the U-drive-it vehicle or motorcycle had elected to pay the optional gross receipts tax.

Return Check Penalties
NCGS 105-236 states: “When the bank upon which any uncertified check tendered to the Authority in payment of any obligation due to the Authority returns the check because of insufficient funds or the nonexistence of an account of the drawer, the Secretary shall assess a penalty equal to ten percent (10%) of the check, subject to a minimum of one dollar ($1.00) and a maximum of one thousand dollars ($1,000). This penalty does not apply if the Authority finds that, when the check was presented for payment, the drawer of the check had sufficient funds in the account at a financial institution to pay the check and, by inadvertence, the drawer of the check failed to draw the check on the account that had sufficient funds. The additional tax imposed may not be waived or diminished by the Authority.

For information on Wake County tax click here.