If you reside in Georgia, you might have noticed that the Georgia lease taxes and laws in your state have changed. If you are wondering how this impacts you, you’ve come to the right place! As of January 1st, 2018, Georgia has updated the Title Ad Valorem Tax, known as the TAVT, which applies to new and used car purchases and new car leases. What exactly is the Title Ad Valorem Tax? Initially introduced in March of 2013, this law requires a tax on leased vehicles to be calculated based on the total of the vehicle’s lease payments, rather than the vehicle’s full value. This new Georgia lease tax and the law will significantly lower the amount paid for leasing a car in Georgia, which is great!
Before understanding how the Georgia lease tax will impact you as a driver, you may be wondering: “what is car leasing?” A lease is the rental of a car for a fixed period of time under an agreement you have with the dealership. When you take home a lease, you’ll experience many benefits including being able to drive a vehicle in its prime, pay less cash upfront, have lower monthly payments, and so much more.
Leasing a vehicle can end up being the less expensive route if you know that you enjoy upgrading often. Why is this? Most people provide a hefty down payment when they finance a vehicle, only to have it depreciate over time. When they try to sell their model, it will only sell for what it is currently worth, not what you purchased it for. When you lease a model, you can provide a down payment, enjoy your model and then upgrade to another new model when your lease is up or purchase it! With the new TAVT in place, leasing a vehicle will make payments significantly lower since taxes are now based on the total of the payments and not the value. If you’ve never leased a vehicle before, it’s something to consider.
Let’s break it down so that it’s easy to understand. Under the previously TAVT law, if you leased a new Honda vehicle in Athens, GA for $20,000, your TAVT fee would be somewhere around $1,400. This fee would be based on the overall value of the vehicle. Under the new law, you would take a close look at your payment. Let’s say your payment is $299 a month. Your TAVT fee would be calculated based on the total of those payments, which could be around $10,764 if you lease it for 36 months. The updated TAVT means that instead of $1,400 being due at signing for a $20,000 car, all you have to pay is $753.48! You can even finance this amount into your monthly payment and call it a day. Either way, you’re saying over half a grand.
Now that you have all the Georgia lease tax information you need, are you interested in getting your hands on one of our exclusive Honda lease specials in Athens, GA? We get it. Luckily, there are multiple ways to contact our finance professionals. You can apply for financing online, visit our dealership, or call our direct line. Whichever route you choose, you’ll be sure to experience the Honda service you desire. We look forward to helping you get behind the wheel of a new Honda vehicle for a reasonable price in Athens, GA. Contact Phil Hughes Honda for all of your Honda lease questions!