California Publishes Guidance for Vehicle Use Tax Exemptions

Friday, February 27th, 2015

 
 
Keys to a car.
Share
Link
California
Automotive

The California State Board of Equalization ("Board") released guidance on vehicle and vessel transfers that are not subject to California use tax.

California taxes sales of vehicles and vessels ("vehicles") unless an exemption applies. When a vehicle is purchased from a dealer in California, the dealer is responsible for reporting and paying sales tax. When a vehicle is purchased from someone other than a dealer, the purchaser must pay use tax. The use tax rate is generally the rate that applies where the vehicle is registered or moored. The sales tax rate is generally the rate that applies where the vehicle is sold. Purchasers can pay use tax either to the Department of Motor Vehicles ("DMV") when they register the vehicle or directly to the Board.

California exempts some vehicle sales to individuals by non-dealers. A vehicle is exempt from use tax when it is (1) received as a gift, (2) purchased from a family member, (3) involuntarily obtained through inheritance or court order, (4) received in the dissolution of a company, (5) purchased and delivered out of state without being used, (6) purchased and delivered out of state by active duty military personnel who then transfer to California and bring the vehicle with them, (7) purchased by the U.S. government, (8) purchased for out-of-state use and only used in California while being removed from the state, or (9) purchased by an American Indian for use on a reservation.

If a purchaser qualifies for a use tax exemption, the purchaser may get a Use Tax Clearance certificate from the Board. This certificate allows the purchaser to register the vehicle in California without paying use tax. The DMV can process vehicle registrations without this certificate but is not required to do so.

http://www.boe.ca.gov/pdf/pub52.pdf


About TTR

Transaction (buying or selling things), Tax (the tax on this activity), Resources (our people, our website, our support services) - TTR, Inc.

TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

Please visit TTR on the web at www.ttrus.com or call 866.578.8193.

Marketplace Facilitators of Software Products to be...

Friday, March 15th, 2019 -The Commissioner of Taxation and Finance in New York released an advisory opinion that determined third partie...

Arkansas Rules on Taxability of Repairs and Labor Related...

Wednesday, March 13th, 2019 -The Arkansas Department of Finance and Administration recently released an administrative decision addressing ...

Studio Room Rental for Photography Sessions is Subject to...

Wednesday, March 6th, 2019 -The Missouri Department of Revenue (DOR) has released a letter ruling addressing the taxability of studio room...

Unprocessed Sand Not Taxable in Texas

Monday, March 4th, 2019 -The Texas Comptroller recently released a private letter ruling that found the mining and selling of unprocess...

California to Require Additional Registration and...

Friday, March 1st, 2019 -California recently released a special notice for out-of-state retailers who are required to register with the...

Guided Hunting and Fishing Trips are Taxable in Washington

Wednesday, February 27th, 2019 -The Washington Department of Revenue recently published guidance stating that guided hunting and fishing trips...