New York Vehicle Sales Tax
Knowing the associated taxes is one of the most important aspects of dealing with a vehicle purchase. This includes any state sales tax that your state imposes.
New York has one of the nation's highest car sales tax requirements. When buying a car in this state, it's critical to understand all factors that go into the taxes and fees. As you shop for a car in New York, we'll go over everything you need to know about the sales tax.
How Much Is The Vehicle Sales Tax in New York
According to the Sales Tax States, you will pay a 4% sales tax
when buying a car in New York. Any county or city sales taxes that may apply are not included in this statewide tax. In New York, city and county sales taxes can be as high as 4.75 percent
, resulting in a total sales tax of 8.75 percent
for a vehicle purchased in the state.
With a 4 percent city tax rate, Pleasantville has the lowest city tax rate in New York. The highest tax rate is found in New York City, with an 8.88 percent tax rate
. In New York, the average total car sales tax is 7.915 percent.
New York is one of the five states with the highest local vehicle sales taxes.
Calculate Sales Tax
You can use the tool provided by the New York State Department of Taxation and Finance website to calculate the sales tax you may have to pay for a vehicle in New York. Individuals can use this tool to estimate the total state and local taxes they'll have to pay for a vehicle by entering their zip code and address. The sales price of your vehicle will then be multiplied by the tax rate applicable to your New York address.
Factors Affecting the Vehicle Sales Tax
When calculating how much sales tax you will pay for a vehicle in New York, keep the following factors in mind:
You can get a sales tax exemption if you buy a used car from a relative, such as a parent or a stepparent, child or stepchild, sibling or spouse. On the other hand, the seller must not be a licensed auto dealer. When purchasing a vehicle from a relative or anyone else, don't forget to fill out a DTF-802 Form.
You wouldn't have to pay sales tax again when registering your vehicle if your dealer factored it in at the time of purchase. You must pay what you owe during registration if the auto dealer did not include it in the purchase price.
Rebates and Incentives
You can get a credit equal to the value of your old car if you trade it in at a dealership for another used car. You can also take advantage of any manufacturer or dealership rebates.
As a result, if you use your credit or cash rebates toward purchasing a car, you will pay fewer taxes because the overall purchase price will be lower. Because the state of New York only taxes what you pay out of pocket, this is the case.
You may owe state sales taxes if you buy a car in another state while living in New York. You must also show proof of paying those taxes when registering your car in New York to claim a credit to reduce your debt.
You may not be able to claim the credit if the state where you purchased your vehicle does not have a sales tax agreement with New York. As a result, be cautious.
If you weren't a New York resident when you bought a used car, you might be exempt from the state's sales tax. In this case, you must fill out and submit Form DTF-803
to take advantage of your non-resident exemption rights for sales taxes.
Vehicle's Market Value
The fair market value of the used car you buy can affect how much sales tax you pay. Because the DMV calculates sales tax using fair vehicle valuations, this is the case.
If you buy a car for less than its fair market value, you may be eligible for a credit or refund for the difference in sales tax. As a result, make sure the seller's affidavit section of the DTF-802
is completed and signed.
Other New York Vehicle Taxes
Most dealerships allow customers to trade in their old vehicle for credit toward purchasing a new vehicle. For example, if you trade in a $3,000 car, you'll receive a $3,000 credit toward a new vehicle. In New York, vehicles are only taxed based on the buyer's out-of-pocket amount. This means you won't have to pay sales tax on the $3,000 that your trade-in credit deducts from the price of your new vehicle.
Dealer incentives and rebates, on the other hand, are not the same. To attract new customers, many dealerships offer incentives and rebates. For example, if you buy a $20,000 car, you might get a $1,000 cash rebate, lowering your out-of-pocket costs to $19,000. In New York, you will be charged sales tax on the total of $20,000 rather than the $19,000 you paid.
Documentation Fee in New York
In addition to taxes, dealerships frequently charge buyers documentation or doc fees. These charges cover the costs incurred by the dealership in preparing and filing the necessary paperwork for a vehicle purchase. In New York, the average documentation fee is $75.
When you buy a car from a dealership, the dealership will handle all your paperwork. In New York, the average "Doc Fee
" per transaction is $75
However, you should be aware that dealerships may charge additional "in-house" fees. Advertising and destination fees are examples of additional fees. While the documentation fees are non-negotiable, the advertising and delivery fees may be negotiable.
In New York, additional fees are frequently collected during the vehicle purchase process. These costs could include:
- Fees range from $32.50 to $140 for registration.
- Fee for the title: $50
- Fee for plate transfer: $10
The New York Department of Motor Vehicles usually collects these fees, which total around $74.
In most cases, if you receive a car as a gift, you will not be required to pay sales tax on the vehicle's value. You do not have to pay sales tax if your parents or grandparents give you a car or if you inherit one after a relative dies. If someone unrelated to you gives you a car rather than selling it to you, or if a court orders someone to give you a car, you do not have to pay sales tax.
In New York State, all car purchases are subject to sales tax, but there are a few exceptions. If you meet the following criteria, you can apply for a car sales tax exemption through the New York DMV using Form DTF-803.
- At the purchase, you were not a resident of New York State.
- The vehicle was acquired (but not purchased) as an estate settlement.
- You're an active-duty military member who bought the car while stationed out of state.
- The vehicle will primarily be used for agricultural purposes.