Proportionate payment of VRT on leased vehicles
Extending a lease
Where the lease agreement for a vehicle is extended and:
- the lease remains in the name of the person or business declared at first registration of the vehicle
- and
- the total period of the lease remains under 48 months
then the person or business in whose name the vehicle is registered must pay the additional duty and interest.
The additional Vehicle Registration Tax (VRT) can be paid online using the MyPayments section on MyAccount or ROS.
- Example 1
Lease extended for a further 24 months
| Max VRT = €10,000 |
Vehicle Registration Tax (VRT) normally due |
| Amount due = €2,100 |
The lease in this example is from 14 September 2019 to 13 August 2020 = 12 months €10,000 * 21% (percenatage payable for 12 months). |
| Additional VRT now due = €2,400 |
Extension for 24 months. VRT rate payable for 36 months (12 months + 24 months) is 45%. VRT payable for the 36 months is €4,500 (10,000 * 45%) less €2,100 already paid = €2,400. |
| €2,400 * 0.0274% * 335 days = €220 |
A daily rate of interest is charged on the additional amount that should have been paid when the car was first registered. In this case, that amounts to €2,400. The charge is applied from the first registration date to the date when the terms of the lease were varied. In this case, that is 335 days.
|
| Total: €2,620 |
This is the total amount of VRT and interest now payable to extend the lease by 24 months.
|
- Example 2
Lease extended for a further 12 months
| Max VRT = €10,000 |
Vehicle Registration Tax (VRT) normally due |
| VRT paid to date = €4,500 |
The lease in this example is for 36 months from September 2019 to August 2022. The VRT paid to date on this car is €4,500 ((€10,000 * 21% [12 months]) + (€10,000 * 45% [36 months])). |
| Additional VRT due = €900 |
The second extension is for 12 months. The proportionate rate payable for 48 months (the original 12 months + the first 24-month extension + the 12-month extension) is 54%.
The VRT payable for the 48 months is €5,400 less the €4,500 already paid = €900.
|
| €900* 0.0274% * 1,080 days = €266 |
Revenue will charge a daily rate of interest on the additional amount that should have been paid at first registration. The interest due now is for the number of days to the date beginning the second extension to the lease. In this case, that is 1,080 days.
|
| Total amount payable for the extension = €1,166 |
This is the total amount of VRT and interest payable to extend the lease by 12 months. To the maximum of 48 months for this car.
|
Next: Retention of the vehicle