DMV-DIRECT Newsletter September 2017
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SALES TAX CHANGES AFFECTING OUT-OF-STATE TRANSACTIONS Make sure your calculation systems are up-to-date!
Two states recently implemented sales tax changes that impact out-of-state transactions for New York dealerships: - New Jersey now requires sales tax to be collected on all doc fees in both lease and retail deals . Previously, only NJ lease deals required the collection of sales tax. (As a reminder, if the dealership is remitting sales tax to New Jersey, make sure to use the “New Jersey Sales Tax” stamp to mark the “Application for Certificate of Ownership” to the right of the purchase price box. Also remember that this application will be rejected unless it includes the dealer’s signature.) - In South Carolina, the maximum sales tax on the purchase of a motor vehicle has increased from 3% of the purchase price (or maximum of $300) to 5% of the purchase price (or a maximum of $500) . If a dealer sells a vehicle to a customer who intends to register their vehicle in South Carolina, that customer must pay the new 5%/$500 sales tax. There is another new state-imposed fee to register a vehicle in South Carolina, even if the vehicle has already been registered elsewhere. If a vehicle is initially registered in another state and comes to South Carolina to be reregistered, the individual reregistering the If a customer wishes to purchase a new or used vehicle that they plan to export to Canada, dealers are advised to take the following steps during the transaction: Refer to the dealership’s franchise agreement. These may contain specific rules that are to be followed when registering one of the manufacturer’s vehicles for exportation. Dealers who fail to comply may face fines or penalties from their OEM. Call the Registrar of Imported Vehicles hotline at 888.848.8240 to find out if the vehicle meets Canadian requirements. (This could include emissions, necessary safety features, and more.) Supply the customer with a recall clearance letter validating that there are no manufacturer recalls on the vehicle. 3 2 1
vehicle must pay a fee of $250.00. (Only active military members and their spouses and dependents are exempt from this fee.) If a customer purchases or leases a vehicle, obtains an in-transit permit to bring it to South Carolina, and pays the SC sales tax at the point of purchase or lease, they will not need to pay the $250.00 later on . South Carolina has also announced that its registration fees will be increasing in January of 2018. The state will release the new fee schedule for titles, tags, and registration later this year. DMV-DIRECT will let dealers know as soon as this information is made available.
Dealers are advised to assure that the above adjustments have been made in their
compu t e r systems, to avoid errors in sales tax calculations.
GOING NORTH: WHAT TO DO WHEN SELLING A CANADA-BOUND CAR
The documentation the customer will need in order to cross the border will vary depending on the exact border crossing they intend to use . Contact the specific border station, ask them what is required, and then notify the customer. At the border, the customer will be required to complete a form allowing the vehicle into the country and pay a fee. The 4
formmust be kept in the vehicle until it is registered in Canada. Once the vehicle enters Canada, the customer will receive a letter explaining what needs to be done to register it there. For more information call at 718.747.0400
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