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Last month, the North Carolina Department of Revenue (“NCDOR”) provided guidance on a new tax applicable to peer-to-peer vehicle sharing providers under N.C.G.S. § 105-187.5. Effective October 1, 2026, peer-to-peer vehicle sharing providers must collect tax on their gross receipts from short-term and long-term vehicle rentals, leases, and vehicle subscriptions.
Under the newly amended N.C.G.S. 20-280.15, peer-to-peer vehicle sharing is defined as “the authorized use of a shared vehicle for financial consideration by an individual other than the shared vehicle owner through a peer-to-peer vehicle sharing program.”1 A peer-to-peer vehicle sharing program is a “commercial business platform that connects shared vehicle owners with drivers to enable peer-to-peer vehicle sharing.”2 Common examples of peer-to-peer vehicle sharing programs include Turo or Zipcar.
The new applicable tax rates are 8% for short-term leases or rentals, 5% for vehicle subscriptions, and 3% for long-term leases or rentals. The tax applies to rentals and leases billed on or after October 1, 2026.
Peer-to-peer vehicle sharing providers must register with NCDOR before October 1, 2026, and report the tax on Form E-500F, Motor Vehicle Lease and Subscription Tax Return, according to their assigned filing frequency.
For more information about the tax on peer-to-peer vehicle rentals, please see the Sales and Use Tax Directive 26-2 on the NCDOR website.
Footnotes
1. N.C.G.S. § 20-280.15(2) (2026).
2. N.C.G.S. § 20-280.15(3) (2026).
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