2018 GNYADA Membership Directory

KEY REMINDERS ON SALES AND USE TAX ISSUES

Mixed-Use Vehicles: Dealers may compute use tax due on “mixed use” vehicles (i.e., loaner cars, demos used by employees) on 1% of the cost per month if the vehicle is used:

• For six months or less with no mileage restriction; or • For more than six months but no more than one year; and • For less than 15,000 miles.

Dealers must also remember that: • If the mileage exceeds 15,000 miles or number of months used exceeds 12 months, FULL sales tax will be assessed on the cost of the vehicle. • Demo log should be maintained reflecting dates in and out of service. • Use tax will not be due if you state on the sales invoice or other written document provided to the customer that the sale includes the use of a loaner car. • Vehicles held in inventory exclusively for resale but used for demonstration to customers are not taxable if used solely for demonstration. Sales of Motor Vehicles to Non-Residents • If the vehicle is sold to a non-resident who will register it in New York, sales tax must be collected based on the rate in effect where the sale occurs. • When in-transit permits are used, the vehicle is not subject to New York state and local sales tax. To claim the non-resident exemption, purchaser must: • Be a non-resident of New York State. • Have no permanent place of abode in New York.

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• Not be engaged in business, employment or trade in New York. • Give the dealer a completed non-resident affidavit (Form DTF-820). • Dealer must indicate EXEMPT: OUT OF STATE PURCHASE on the MV-50. • ANY TIME a buyer resides in a county

that is different from where your dealership is located, the customer must complete a DTF-820.