Strengthening and expanding business activity, tax incentives, strengthening corporate culture, improving cash reserves. Numerous business advantages are pushing many Greek companies to take the decision to rent vehicles, following a trend that has been successfully applied in most European countries for many years. A related study by Grant Thornton, conducted in May last year, confirmed that leasing vehicles (cars, trucks, buses, construction equipment) contributes to the overall functioning of the business, frees it from bureaucratic procedures and eases the tax burden.

The study was conducted on behalf of Kinsen Hellas, the company that brought the French giant Europcar to Greece, offering modern and innovative Rent A Car and lease services. Kinsen Hellas is the creation and shared vision of a group of European private investors and a Greek family with a long history in Greek business. Kinsen Hellas is the only company that offers complete mobility solutions, from motorcycles to the most specialized trucks, buses and construction equipment, for both transport and commercial enterprises.

Business Benefits

Operational leasing of commercial vehicles is a relatively new process in our country. It was established by law 4663/2020 (art. 32), which provides for the leasing of vehicles of certain categories and putting them into circulation for public use on behalf of the lessee under certain conditions. The leasing service for heavy trucks, construction equipment and tourist buses is intended for professionals, companies and organizations interested in vehicles over 3.5 tons or buses over 9 seats. Operational leasing allows transport companies, as well as commercial enterprises, on the one hand, to enjoy the benefits of leasing, and on the other hand, to indirectly strengthen their economic activities.

Through Kinsen Hellas, the company has the opportunity to acquire modern vehicles, expanding its services. To use them through flexible leasing programs that suit her needs, as well as the ability to determine the duration, height and type of vehicle. At the same time, according to the study, corporate culture is strengthened through vehicle leasing. In addition, by being able to lease vehicles from Kinsen Hellas with modern technology and a greener focus (less fuel, less damage, more economical maintenance), the company is projecting a green face in society as its vehicles contribute to the reduction of pollutants in the environment. In addition, through leasing, the enterprise is freed from labor-intensive procedures (insurance, vehicle maintenance, tolls), and its cash balance improves as it uses its income and has a complete picture and forecast of its annual vehicle costs. Finally, the cost of renting is deductible from income tax and VAT in the case of a commercial vehicle.

tax incentives

According to Grant Thornton’s research by Grant Thornton for Kinsen Hellas, a company that chooses leasing as a solution for its vehicles can enjoy a significant tax “breather”. Operating lease expenses for commercial vehicles are fully deductible from the taxable income of each business, provided that the leased vehicles are used in the context of the company’s purposes and business.

The advantage of a rented car is also that the company is not “burdened” with fixed assets and unforeseen costs, while, depending on its activities, it can annually determine the cost of its cars (reduction or increase in the fleet).

When does the VAT offset take place?

The main question businesses are concerned about is whether they can “debate” VAT. (24%) lease of commercial vehicles so that the business has more money. As Grant Thornton points out in his study, FPA is fully recognized as a VAT deduction. from sales of the company, as well as VAT. any other professional expenses incurred in the context of achieving business goals.

In leasing vehicles, VAT on rental is not recognized for offset, however, in the case of commercial vehicles, VAT deduction is carried out in full. In order to receive a discount, the rented car must be used by the company in any activity, the income from which is subject to VAT.

As stated in a study conducted on behalf of Kinsen Hellas, if the monthly rental of the vehicle is 2,000 euros (plus VAT) and it is rented by a legal entity, the final cost after taxes for the company will be up to 1,560 euros (reduction on corporate tax 22%).