A car for some residents of the Russian Federation plays the role of a vital property. But sometimes the time comes to get rid of the vehicle. For example, if the owner plans to purchase a new vehicle. Do I have to pay car sales tax? And if so, how to do it? What are the benefits in a particular case? By answering these questions, a person can easily sell his personal property. Otherwise, serious problems may arise with the Federal Tax Service. They are fraught with certain sanctions. We will talk about them later.
Right or obligation?
To begin, consider the key points of the topic. Do I need to transfer the tax on car sales?
According to the legislation in force in Russia, upon receipt of profit, a citizen is obliged to pay tax in the prescribed amount. The exact amount depends on the money transferred.
It's about income tax. And therefore, ideally, when selling property (including cars), the owner gives part of the income to the state treasury. This is the duty of the taxpayer.
Nevertheless, taxation on the sale of vehicles and real estate is not always the case. Preferential conditions in Russia regarding taxes have been present for a long time. And almost everyone can use them. A little later we will figure out when and how it is permitted not to pay for the sale of property.
Payment Amount
What car tax will a citizen transfer? We are talking about personal income tax. For different categories of the population, the amount of deductions will be different. Especially when it comes to specific numbers.
We found out what tax is levied on car sales. The size of payments is determined as follows:
- 13% of the amount under the contract - for residents of the Russian Federation;
- 30% of the funds received - for foreign citizens.
It is impossible to provide more accurate information. After all, as already mentioned, a specific tax on the sale of a car is set depending on the value of the property.
Due date
Up to what point do I have to transfer the taxes?
In this matter, everything is much simpler than it seems. Personal income tax for individuals is paid until July 15 of the year following the one in which the transaction was concluded. That is, having sold the vehicle in 2017, you will have to pay for it until 07/15/2018. This rule is regulated by the Tax Code.
It is important to remember that a person must report on his income before paying tax. This is done by filing a declaration with the local authority of the Federal Tax Service. The declaration of profit of the population is carried out until April 30 of the year following the period in which the seller was transferred money for the transaction.
Consequences of non-payment
By concluding a car purchase and sale agreement, the tax will have to be paid almost always. But there are exceptions. We will meet them later.
First, find out what is fraught with concealment of income and tax evasion of personal income tax. A citizen may face the following penalties:
- a fine in the amount of up to 20% of the debt if the report occurred and the money was not transferred;
- interest accrual;
- a fine of up to 30% of the payment if the declaration is not filed.
In addition, the owner may be called to the Federal Tax Service to write an explanatory note. All this is a lot of trouble. Therefore, it is better to find out the basics of Russian tax legislation. Then, when selling a car, there will be no problems.
New owner and sale of vehicles
What tax on car sales will have to pay? Citizens of the Russian Federation pay 13% of the amount under the purchase agreement. A lower payout is not foreseen under any circumstances.
Now consider the different scenarios. Suppose a person bought a vehicle and wants to sell it. The car is owned by the seller for less than 3 years. What then?
In this case, ideally, taxation is present. Under current law, the tax on the sale of a car less than 3 years of ownership is charged without fail. 13% of the proceeds will have to pay.
Long ownership and sale
But what if the vehicle is owned by a person for more than 36 months? This option is more common in real life.
Taxes on the sale of a car that has been owned for more than 3 years are not levied. This is a kind of privilege that everyone can count on. The main thing to remember is that 36 months will expire day after day after purchasing a car.
In other words, if 3 full years expire on the day after the transaction for the sale of movable property, the old owner of the vehicle will have to pay the full tax. And in case of conclusion of the operation on the next day after the expiration of 36 months - no.
Many people prefer to wait for the specified period and only then sell the car. A similar technique is often used in relation to real estate, so as not to face taxation.
Small amounts
How much is tax deductible when selling a car? Are there any benefits in this regard?
Yes. The fact is that there are preferential conditions that allow owners not to transfer personal income tax per transaction. The rules will apply even when the car is owned for less than 36 months.
For example, the amount of tax on the sale of a car will be zero if no more than 250,000 rubles are transferred under the contract. No personal income tax is levied on these funds under any circumstances.
That is, the tax on the sale of a car does not apply to transactions for which a citizen receives no more than 250 thousand rubles. Most often, this alignment is found in relation to old cars.
Losses for the owner
But that is not all. There are other benefits to the topic being studied.
We found out when car sales are tax deductible. The last exception is transactions made at a loss to the owner. It is a seller of movable property.
In other words, if a person bought a car for 3 million rubles, and sold it for 2,000,000, no taxes would be required. In any case, the seller will be released from personal income tax. The privilege is connected with the fact that a person initially makes a deal at a loss, without actually receiving real profit.
How to reduce the fee
In Russia, there are many secrets that help legally reduce the tax on the sale of a car. What exactly is it about?
For example, a seller of movable property can reduce the amount of personal income tax by the amount allocated for the maintenance and servicing of a car. The main thing is to prove that the costs incurred by the previous owner of the vehicle.
Under certain conditions, a tax deduction can be made. Citizens who work officially are entitled to receive a refund of 13% of the costs incurred in selling the vehicle.
Documents to reduce payment
A tax on the sale of a car (less than 3 years of ownership) will be levied, but it can be reduced. We take advantage of the cost of maintaining the machine.
The owner-seller will need to not only file a declaration with the Federal Tax Service in a timely manner, but also present:
- passport;
- sale agreement;
- documents for the car;
- repair receipts;
- receipts for the purchase of spare parts and vehicle parts;
- maintenance agreement.
This is the main package of documents that will help reduce the tax in the end. The receipt of the deduction will be considered below. First, find out how to file a tax return.
About filing a declaration
The amount of tax when selling a car is calculated taking into account the profit received under the contract. To do this, you need to submit a declaration in the form of 3-personal income tax.
Corresponding paper is always sent to the Federal Tax Service - and if it is required to pay taxes in the end, and when using benefits.
The seller will have to act like this:
- Collect a package of papers of a standard form. Their list is presented below.
- Fill out the form 3-NDFL.
- Submit a set of documents to the local authority of the Federal Tax Service (according to the seller’s registration) within the time limits established by law.
That's all. There is nothing difficult about this. You can bring the idea to life:
- personally;
- by mail
- in electronic form (on the website of the Federal Tax Service or on "State Services").
Today, personal appeal to the tax is in greatest demand. Therefore, we will dwell on just such a situation.
In the case of using electronic filing of documents, the user will:
- Log in to the service of the Federal Tax Service or State Service.
- Find a service for filing income statements.
- Fill out the request form following the on-screen prompts.
- If possible, attach screenshots / photos of good quality available papers.
- Make an appointment with the Federal Tax Service.
It only remains to come on the appointed day to the tax with a pre-assembled package of securities. Nothing more is needed. Everything is not so difficult as it seems initially.
Documents for declaration
A huge role in taxation when selling a car is played by the filing of a declaration. This is a key point that affects the overall situation.
In order to submit the 3-NDFL form to the Federal Tax Service, a number of documents are required. The seller of the car will need:
- identification;
- purchase agreement;
- receipt of money for the transaction;
- documents for the car;
- contract of purchase / gift / inheritance of the vehicle to the seller;
- other papers that help reduce tax or completely get rid of it.
As practice shows, paperwork does not involve any hassle. Additionally, it is better to attach a copy of the buyer’s passport. This technique will save you from any problems in the future when studying the FTS documentation. It will be clear who bought the car and from whom.
Transport taxes
There is another question that worries many citizens when buying a car. In particular, if there is a purchase of a vehicle from hand, that is, a used car is purchased.
This is a transport tax. When selling a car do you need to pay it or not? And how long will the former owner have to pay for the movable property sold?
Directly when selling a car, the seller does not have to pay transport taxes. But the time of the transaction will be taken into account when calculating the amount for owning a car in the end.
Another year after the sale of the vehicle, the previous owner of the movable property will transfer the tax on transport. This phenomenon is connected with the fact that taxpayers pay for property one year after its acquisition. So, when selling a car in 2016, the transport tax is paid the last time in 2017. This will be the payment for the previous year.
There is another feature that you should pay attention to. This is the procedure for calculating transport tax. When selling a vehicle, the seller, one year after the conclusion of the relevant transaction, pays for the transaction, but in smaller sizes than usual. The amount of transport tax when selling a car is calculated taking into account the full months of ownership of the vehicle.
Important: rounding to a month is carried out if the owner sold the car on the 15th or later. Otherwise, a decrease in the time of ownership.
Suppose the transaction was completed on June 16, 2016. Then the seller will pay in 2017 the tax on the car, calculated for 6 months. If the sale was carried out on June 14, you will need to pay for 5 months. All this is not so difficult to understand.
Deadline for paying tax on vehicles
Now a few words about how long it will take to pay the transport tax. More precisely, when citizens must pay for the sold movable property not according to the declaration.
Notifications of payment of transport taxes are sent, as a rule, until November 1 of the year following the period of acquisition (or sale) of property. And you need to pay the receipt until December 1, inclusive. Starting from December 2, accrual of interest will begin. And the corresponding payments will not affect the new owner of the car.
Owner Advice
Selling a car is not taxable if a citizen sells property that he has owned for more than 3 years or when a transaction is made in the amount of not more than 250 thousand rubles. These are the most common scenarios.
Here are tips to help citizens get ready to pay taxes when selling vehicles:
- Save all documents indicating the purchase of the machine and its contents. These papers come in handy when declaring income.
- If a person wants to sell a car that has been owned a little less than 3 years, it is better to wait a bit. After 36 months of ownership tax for the transaction will not be.
- When making payments, be sure to ask the buyer for a copy of the passport, and also issue a receipt on receipt of funds.
- Submit income statements in advance and pay taxes. Delays are fraught with additional costs in the end.
It is important to remember that verification of transactions for the sale of cars is carried out by the Federal Tax Service very quickly. Such operations are recorded in the traffic police when registering vehicles for the new owner. Therefore, income should not be hidden. And look for workarounds for tax evasion, too.
Summary
We figured out all the features of taxation when making transactions for the sale of cars. Now this topic will not cause any trouble. Especially if you prepare for operations in advance.
Ideally, citizens pay car taxes when selling the property. But under certain circumstances there is no taxation. The described principles are valid throughout the Russian Federation without exception. And therefore, it will be possible to be exempted from taxes for a transaction only in exceptional cases.
Based on the foregoing, we can conclude that the seller of the vehicle will have to focus on the following time limits:
- filing a declaration - until April 30;
- Payment of personal income tax under the agreement - until July 15;
- receipt of tax notices on transport tax - until November 1;
- Payment of car tax - until December 1.
In all cases, the year following the transaction period is implied. There is no need to make appropriate payments instantly. You can take your time with these tasks. The main thing is to meet the deadlines. With timely preparation, this is not so difficult.