What is Car renting?

Discovers the renting of cars: what is and how works.

There are several ways of be able to enjoy the use of a car: can acquire a vehicle as owner, rent it for use occasional, or contract a rent long-term with a service of leasing or renting. 

In this item you explain in what consists the renting, the passwords of this rental contract of cars and the tax advantages that you can give.

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What is renting?

The renting is a rental contract of cars long-term (has a duration minimum of 24 months and maximum of 60 months) through which a company or an individuals can use a car of a model determined and with a mileage specified in exchange for the payment of a monthly fee.

Passwords of the renting of cars

Having in mind the definition of carsrenting, what is specifically, is important take into account that deals basically of a hire service of vehicles, although with some characteristics that it distinguish of other types of rents as, for example, the public to the one which goes directed, the expenses that include in the rental contract or what happens with the vehicles to the finish the contract. 

For start, is important know who can rent a car for renting. Until recently, were the companies and the self-employed workers which chose the renting as solution to the development of your economic activity, but this option is more and more widespread also among the individuals

Another of the aspects that distinguish to the renting in front of other options of rent is that one of the expenses of the contract. This includes: 

  • All the expenses associated to the purchase of the vehicle (as, for example, the tax of registration). 
  • Maintenance service and checkups, as well as the change of tires. Usually, in the contract of renting usually include a clause that compels to the driver to come every a certain time to revise the car. These checkups compulsory are included, as well as the repairs necessary in the event of breakdown. 
  • Breakdown service. 
  • Insurance
  • Service of complaint of fines until exhaust the official channel. 


Taking into account all that includes the renting service, not is of surprise that is a so popular option between businesses and individuals. However, owes take into account that there are a series of expenses that the renting not includes as, for example, the refueling, the fines that not can be resorted successfully, and the repair of damages in the event of malpractice of the driver

Last of all, there are some differences between the renting and the leasing. The more important takes place to the completion of the contract. In the renting, the leaseholder can extend the contract or return the car whereas the leasing you offers a third option: acquire the vehicle for your residual value.

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Tax advantages for companies and individuals

The second reason whereby both businesses and individuals decide obtain a car through a contract of renting, instead of buy it, is that this system offers certain tax advantages . For the Internal Revenue service, the purchase of a car supposes an investment that not is deductible from the income tax of individuals, in the case of the self-employed workers and individuals. On the other hand, the renting considers a rent that can include in the running expenses and that is completely deductible in any of the two cases. That is the major advantage of this system: is possible deduce all the monthly fee of renting of the IS and of the PERSONAL INCOME TAX. 

Moreover, what is usual is that can also deduce 50% of the VAT applied to the fee, although if proves that the vehicle uses exclusively for the development of the occupation, can deduce 100% of the VAT. 

All in all, are many the individuals that choose the many advantages that them offers a renting service when have a vehicle. In BBVA offer to our options different customers of renting of cars with all the expenses of maintenance and insurance included. If want find out more about this service, visit bbva.es or approach any of our branch offices.

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