Koalafi allows specific categories of items to be leased based on Lease-To-Own (LTO) laws and regulations, as well as company policy.
Generally, leasable items are considered tangible durable, safe, and movable property that can be physically returned if needed. For Koalafi, most common examples of leasable items include furniture, appliances, durable electronics, and tires.
Principles of leasable items
If you are contemplating if an item is leasable, these 4 principles can help you make that determination:
Tangible – Item is physical personal property
Durable – Item will last beyond the term of the lease (12+ months)
Safe – Item is safe and poses no risk or harm
Returnable – Item is capable of being returned in a reasonably good condition
Principles of non-leasable items
If an item doesn't meet the criteria for a leasable item, it's most likely non-leasable. The categories below outline what is prohibited from being leased with Koalafi.
Business use: Items leased to businesses or intended for business or commercial use.
Consumables: Items that won't outlast the life of the lease, such as oil, food, or clothing.
Non-returnable items: Items that can't be returned because they're permanently attached to something else or because of how they're installed, such as flooring, lumber, non-removable car parts, or in-ground and large pools.
Licensed or titled items: Items that require a license or title, such as vehicles, trailers, or professional drones.
Intangible items: Items without physical possession, such as memberships, product codes, or insurance.
Currency alternatives: Items considered or used as currency or monetary alternatives, such as gift cards, cash, gift certificates, or coins.
Unsafe items: Items considered unsafe or risky, such as weapons and ammunition.
Used or refurbished items: Items that are used or refurbished, such as secondhand items, refurbished furniture, or used auto parts.
Michigan disclaimer
Due to state requirements, Koalafi does not lease any auto parts or services in the state of Michigan or to any Michigan residents outside of the state of Michigan.
Indiana disclaimer
Koalafi is limited to only leasing rims, tires, and wheels in the automotive category in Indiana. All other auto-related merchandise and service are prohibited.
How do I handle taxes on Koalafi leases?
Since Koalafi is the initial purchaser of merchandise, we pay sales tax directly. This means that as the merchant, you must not charge sales tax to the customer on Koalafi leases. Koalafi will include sales tax on the customer's lease as part of the "Cash Price."
eCommerce and virtual card taxes disclaimer
For eCommerce and Virtual Card leases, tax can be included when tax is not able to be removed due to limitations in the system. It is charged to Koalafi therefore included in the Cash Price.
Nevada taxes disclaimer
For merchants located in the state of Nevada, this does not apply. Nevada merchants must include sales tax in leases as Koalafi will not charge sales tax in this state.
Questions?
If you have any questions or doubt on whether an item is leasable, feel free to contact Merchant Support at 844-238-6500