Important information for car owners listing vehicles on GoFøroyar

All income must be taxed

As a car owner, you must always report the income you earn from rentals.

Deducting expenses

You can deduct expenses that are directly related to the rental activity (e.g., maintenance, cleaning, etc.).

No tax-free threshold

All rental income must be reported to the tax authorities – there is no tax-free allowance, unlike what may apply to summer house rentals.

All income is B-income

All income from car rentals is considered B-income and must be reported to TAKS (the Faroese tax authority).
There is no fixed threshold where rental activity becomes “business activity” – all income is counted toward your personal total.

VAT obligation

Car rental is a VAT-liable service.
If your rental income becomes substantial, you may be required to register for VAT as a car owner.

Documentation

You must prepare an accounting report to submit to TAKS.
This should be based on proper documentation (e.g., rental agreements, invoices, or annual statements).
We recommend that all car owners maintain a simple record of income and expenses and always report income to TAKS.