Starting a Car Rental Business in Europe: Rules by Country

Renting cars without a driver looks the same in Lyon, Munich, Bologna, Valencia or Split: a car, a contract, a deposit, an invoice. The paperwork behind it does not. Each country has its own registration, rules for rental vehicles, VAT rate and, in 2026, timetable for electronic invoicing. Here are the five, then a shared checklist.

This is general information based on the official sources listed below, as of September 2026. It does not replace legal, tax or insurance advice: rules change, so check your project with an accountant, a lawyer and an insurer in the country where you set up.

France: the one-stop shop and a changing invoice

Since 1 January 2023, company formalities, from creation to closure, must be completed online through the business formalities one-stop shop (guichet unique), whatever the company's legal form or activity. Our French guide to opening a rental agency (in French) covers the decisions that come first, from the segment to financing the fleet, and what to settle with an accountant, an insurer and a lawyer.

A passenger car has its first roadworthiness test in the six months before the fourth anniversary of its first registration, and a pass is then valid for two years. Passenger car rental, short or long term, is taxed at the standard VAT rate: 20% in mainland France and Corsica. Since 1 September 2026, every company must be able to receive e-invoices and large and mid-sized ones must issue them; SMEs and micro-enterprises must issue them, and transmit transaction and payment data, from 1 September 2027. For private customers, that means e-reporting of transaction data, not an e-invoice.

Germany: a trade notification, not a licence

Anyone starting a trade must notify the competent authority at the same time (§ 14 GewO). Renting to self-drivers needs no hire-car licence (Mietwagengenehmigung): the Bavarian administration's portal explains that it is for carrying passengers commercially, which matters if you add a chauffeur service. Renting out vehicles without a driver must be notified to the registration authority without delay once the business starts (§ 15(3) FZV), and those vehicles, when not registered to the renter, take their main inspection (HU) every twelve months (StVZO, Annex VIII).

VAT is 19% (§ 12(1) UStG). Every domestic business has had to be able to receive e-invoices since 1 January 2025, and an email inbox is enough. Other invoices remain allowed until 31 December 2026, or until the end of 2027 with a previous-year turnover up to €800,000; after that, the e-invoice is mandatory between domestic businesses. Private consumers are not affected, and a plain PDF is not an e-invoice. Our German guide to starting a rental company (in German) takes each step in order.

Italy: SCIA, CaRGOS and third-party use

Rental without a driver (DPR 481/2001) starts with a certified notice of start of activity (SCIA) to the municipality of the registered office and of each branch or garage. Then comes CaRGOS: each renter's identity document details and the vehicle data go to the Polizia di Stato when the contract is signed and in any case well before handover (Article 17 of Decree-Law 113/2018), on pain of up to three months' arrest or a fine of up to €206; the credentials come from the Questura of the registered office.

Vehicles must be owned or at the company's disposal, for instance leased, and registered for third-party use (uso di terzi) (Article 84 of the Highway Code). Cars have their first revisione within four years of first registration, then every two years (Article 80). VAT is 22%, the standard rate, and rental takes the rate of a sale of the rented goods (Article 16 of DPR 633/1972). Invoices between businesses resident or established in Italy, and to final consumers, are electronic only, through the Sistema di Interscambio (SdI); for foreign customers the e-invoice is optional, but the data must then go to the Agenzia delle Entrate. A new consolidated VAT act applies from 1 January 2027. Our Italian guide to opening a rental business (in Italian) lists the steps.

Spain: a free activity with a customer register

Under Article 133 of the Land Transport Act (LOTT), renting vehicles without a driver is open to any business that meets its tax, social, labour and public and road safety obligations; with a driver, an authorisation is required. The surprise is Royal Decree 933/2021: a computer register of renters, drivers, vehicle, contract and payment, kept for three years, the company's details notified before it starts, and each booking, contract and start of rental reported online within 24 hours. The Canary Islands add a prior notification, and the Balearic Islands an entry in the island tourism registers.

The registration certificate records each vehicle's service, code 01 being alquiler sin conductor; a change of service goes through an ITV station first. Royal Decree 920/2017 sets no special inspection frequency for rental: a passenger car is exempt for four years, then inspected every two years, and every year from ten. VAT is 21%, with the Canary Islands, Ceuta and Melilla outside its scope. Under VERI*FACTU, corporate taxpayers must adapt their invoicing systems before 1 January 2027, and others before 1 July 2027. Royal Decree 238/2026 then makes the e-invoice compulsory for business customers, twelve or twenty-four months after a ministerial order depending on whether the volume of operations exceeds €8 million, simplified invoices excepted unless qualified. Our Spanish guide to setting up a car rental company (in Spanish) covers the islands.

Croatia: a notification to the Ministry of Tourism

The Tourism Services Act defines rent-a-car as the rental of passenger vehicles without a driver by persons registered for that service, with every vehicle registered and insured. Before the first rental, notify the Ministry of Tourism and Sport of your company, seat, OIB and the address of each premises through eTurizam – TuStart, which leads to your entry in the Central Register; starting without it carries a fine of €260 to €1,320. A counter at a station or terminal can serve as premises, with parking spaces for handovers.

Rental vehicles undergo preventive technical inspections, including a daily one before each rental, by the driver with an authorised employee. VAT is 25%. Every invoice paid in cash, by card, by bank transfer or otherwise must be fiscalised; for e-invoices (eRačun) between businesses, VAT-registered businesses issue and fiscalise them in 2026, the others from 1 January 2027. Our Croatian guide to opening a rent-a-car business (in Croatian) puts the steps in order.

Insurance: compulsory cover, declared use

Motor third-party liability insurance is compulsory in all five countries, each with a rental angle:

France — the DGCCRF states that the rental company takes out the liability insurance, its cost built into the base price; have the fleet insurance quoted before buying a vehicle.
Germany — the keeper must insure the keeper, the owner and the driver (§ 1 PflVG), and Berlin asks for an eVB insurance confirmation marked Selbstfahrermietfahrzeug for the rental notification.
Italy — cover for every vehicle (Article 122 of the Private Insurance Code), and the owner is jointly liable with the driver for damage unless the car was driven against the owner's will (Article 2054 of the Civil Code).
Spain — minimum cover of €70 million per claim for personal injury and €15 million for property, and a duty to declare what affects the risk: tell your insurer the car is rented out.
Croatia — liability cover plus accident insurance for driver and passengers.

Documents and tools from the first vehicle

Agreement and terms — drivers, vehicle, dates, price, deposit and excess, accepted before departure; see the essential terms of a car rental agreement.
Condition report — dated photos at pickup and return, attached to the contract; see the digital vehicle condition report.
Deposit policy — amount in line with the excess, hold and release rules; see how a security deposit hold works.
Invoices — continuous numbering and your country's e-invoicing or fiscalisation channel, set up with your accountant.
Fines — who answers the authorities, and how fast; see traffic fines on rental cars in Europe.
Privacy notice — what you keep on renters, for how long, and which authorities receive it.

A spreadsheet lasts until the first double booking or disputed scratch, and vans bring their own needs, covered in our guide to van rental software. We built Corsiva OS for our own rental agencies in Savoie before opening it to other operators. It gives you a per-vehicle schedule with no double bookings, a contract generated from the booking and signed on screen, and invoices with continuous numbering, each copied by email to your accountant or to your accounting software's collection address. That copy is not an e-invoice or a fiscalised invoice under these national schemes, nor is it sent to SdI or VERI*FACTU: that goes through the channel you choose with your accountant. The mobile condition report and the card deposit hold via Stripe come with the Business plan (€98 per month); the entry price is €59 per month excluding VAT with a one-year commitment (€70 without). The interface is in English and French; see the pricing page, and the first month is free.

Where to start

Model — vehicles, customers, sites, prices and legal form.
Registration — the national step above, before the first rental.
Insurance — quotes before buying, with the rental use declared.
Vehicles — registered for rental where required, inspections planned.
Documents and invoicing — checked by a lawyer and your accountant.
Trial run — one rental from booking to invoice before the first customer.

Sources

Book a demo →

Starting a car rental business in Europe: France, Germany, Italy, Spain and Croatia