INSTRUCTIONS
CREDIT FOR SALE OF USED VEHICLE
Pursuant to Act 1232 of 1997, as amended by Act 1047 of 2001, both the seller and
buyer must sign their names to the bill of sale on page 1 of this form in order for the
seller to receive a credit. Please remember that a copy should be given to both the
purchaser and seller.
IMPORTANT: A settlement payment received from an insurance company does
not qualify as a sale for this credit.
The law provides for a sales and use tax credit for new and used motor vehicles,
trailers, or semi trailers purchased on or after January 1, 1998, if within 45 days either
before or after the date of purchase, the consumer sells a used motor vehicle, trailer or
semi trailer. The calculation of the tax due is done in the same manner as the trade-in
credit that is available to those consumers who trade-in a vehicle. Only a consumer
whose name is on the title of the vehicle sold can take the credit. A consumer means
any private individual, business, organization or association. The credit cannot be
transferred to a consumer who did not have title to the vehicle that was sold.
How to take the Credit - This credit is taken directly at your local Revenue Office when
registering a vehicle if the old vehicle has already been sold. To receive immediate tax
savings, simply present a copy of the bill of sale found on the opposite page to your
local Revenue Office when registering the new vehicle.
Important: If the taxpayer claiming the credit fails to provide a bill of sale signed by all
parties to the transaction which reflects the total consideration paid to the seller for the
vehicle, tax shall be due on the total consideration paid for the new or used vehicle,
trailer or semi trailer without any deduction for the value of the item sold.
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For those consumers who sell a vehicle after registering and paying tax on another
vehicle, then a refund may be requested. To receive a refund, pick up a refund claim
form from your local Revenue Office when registering your new vehicle.
Remember
that a copy of the bill of sale for the vehicle sold will also be required in order to receive
a refund. Important: If a vehicle is sold after registering the other vehicle, the sale must
take place within 45 days of the date the other vehicle was purchased.
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