Virginia Dealer Manual - Virginia Department of Motor Vehicles

Virginia Dealer’s Manual
October 1, 2009
Chapter 4: VIRGINIA MOTOR VEHICLE SALES & USE TAX & TITLE
FEES
• Code of Virginia: § 58.1, Chapter 24
4.1 DLR 400-VIRGINIA MOTOR VEHICLE SALES & USE TAX (SUT)
4.1.1 When the Dealer Must Collect SUT
When you act on behalf of your customer and file application for vehicle title, you will
have to collect from the customer and submit to DMV the appropriate motor vehicle sales
and use tax within 30 calendar days of the purchase date. The following paragraphs
explain:
• The collection of the SUT
• That it is based on the sales price of the vehicle
• How to calculate the amount of SUT due on a particular title transaction
• On which transactions an SUT adjustment may be permitted
• Under what conditions a customer may be eligible for a refund of the SUT, and
• Which titling transactions are exempt from SUT
4.1.2 Amount of SUT Collected
A tax of three percent (3%) of a vehicle’s actual sales price and dealer processing fee, if
applicable, is collected by DMV each time application is made to title the vehicle. The
minimum tax on the sale of any vehicle is $35.00, unless if exempt.
§ 58.1-2402 Code of Virginia requires any “Dealer Processing Fee” assessed by a dealer
in pursuant § 46.2-1530 (10) is to be included in the amount on which the Motor Vehicle
SUT is calculated.
4.1.3 Sales & Use Tax is Based on Sale Price of Vehicle
• The sale price shall include any reduction in price shown on the invoice for a
manufacturer's discount or dealer's price discount since they directly reduce the
sale price from the dealer to the consumer. SUT should not be collected on these
price reductions or discounts. Rebates are not subtracted and must be taxed.
• The sale price shall not include any credit given by the dealer for a trade-in,
rebate, unpaid lien or other unpaid claim against the vehicle. SUT should be
collected on these credits.
• When a new owner assumes the payments on a debt obligation of the prior owner,
SUT is assessed based on the unpaid balance of the debt plus any payment made
to the prior owner.
4.1.4 Stated Sale Price Must be Reasonable
If the sale price seems unreasonable when compared with the National Automobile
Dealers Association Used Car Guide or similar publication, The DMV can require the
owner to file Form SUT-1 as evidence of purchase price.
- 52 - Virginia Department of Motor Vehicles