Can a leasing company charge property tax on leased equipment?
2006-10-19 05:18:36 · 3 answers · asked by Julie F 1 in Business & Finance ➔ Other - Business & Finance
Leasing companies do not charge property tax. The leasing company bills the lessee for property tax on the equipment that the leasing company has paid to a county/city. Generally, it is stipulated in the lease that the lessee must reimburse the lessor for any property taxes on the equipment. You can ask for backup but there is nothing wrong with a leasing company billing a lessee for property taxes.
One last thing: I believe the GAAP states that the lessee should be accruing the estimated property taxes monthly but I do not think that many lessees do.
2006-10-19 05:26:42 · answer #1 · answered by Wayne Z 7 · 0⤊ 0⤋
Depends on the agreement. If the agreement states only rental must be paid, then the tax is understood by the lessee to be included with the rent. If the agreement states that rental and taxes must be paid by the lessee, then the lessee must pay for both. If you are just now deciding on whether to charge (or to agree to pay), it would be best to discuss the matter between parties. Normally, taxes such as VAT may be charged to lessees, but property taxes are normally the lessor's responsibility, so it may be best to impute it with the rent.
2006-10-19 05:26:59 · answer #2 · answered by HopeURSatisfiedW/MyAnswers 3 · 0⤊ 0⤋
No, they can not. Well, unless there is a stimpulation in the leasing contract.
2006-10-19 05:24:13 · answer #3 · answered by Anonymous · 0⤊ 0⤋