Whether you’re looking to upgrade your current car or replace an old beater, buying a new car is exciting. Before you buy, be aware of the additional expenses involved. On top of the price of the car, the Sunshine State requires you to pay for registration, tax and title fees, and sales tax. Sales tax is based on the full purchase price of the vehicle - new or used.
If you are not in Florida, check your state’s department of revenue for rates. Other states may charge other fees when purchasing a car as well, including inspection or documentation fees. If you purchase a vehicle through a dealer, you may have other dealership fees.
To calculate Florida sales tax on a vehicle, multiply the whole dollar amount by the tax rate.
Let’s say the purchase price of a car is $20,000. You would owe $1,200 in sales tax.
$20,000 purchase price x 0.06 sales tax percentage = $1,200 sales tax owed
Some counties in Florida also impose a discretionary surtax on the purchase of a vehicle. Any discretionary sales surtax is applied in addition to the 6% sales tax.
Florida’s Hillsborough county has one of the highest total surtax rates at 2.5%. Hillsborough county is one of the most populous counties in Florida. The 2.5% surtax on top of the 6% sales tax makes it the highest tax rate in the state at 8.5%.
As of Jan. 2019, the county imposed a new 1% charter county and regional transportation system surtax, plus a new 0.5% school capital outlay surtax. In effect already was a 0.5% indigent health care surtax plus a 0.5% local government infrastructure surtax.
Get the full list of Florida counties that collect a discretionary surtax and their tax rates from the Florida Department of Revenue.
In Florida, vehicle sales tax is owed on the purchase of any car, motorcycle, truck, trailer or RV. Be sure to consider all other costs before buying a car.
Below is a list of common expenses to plan ahead for.
When looking to pay these fees, contact your local Florida Department of Motor Vehicles to pay them directly. To learn more, research the overall cost to own and auto insurance on the new car as well.
You will still have to pay sales tax if you bought your car outside the state of Florida but are registering it to be used in the state. This tax rate is a six percent use tax. Luckily, if you did pay any local taxes in the state where you purchased the vehicle, Florida allows a credit for these fees.
If the other state’s sales tax ends up being the same or more than Florida’s sales tax, then you are no longer required to pay Florida’s taxes.
Similarly, if the other state’s taxes are lower than Florida’s, you won’t have to pay both fees completely—you only have to cover the difference plus any discretionary surtax applicable.
Some situations qualify as exemptions from all of Florida’s sales tax. Below is a list of what’s completely exempt from sales tax:
Another tax exemption applies to some trade-in situations. When two individuals trade-in a vehicle for another motor vehicle, you can subtract a trade-in allowance from the sales tax due. This transaction must be between two individuals (not a dealership) and must be in return for another vehicle such as a car, motorcycle, mobile home, aircraft, or boat.
It’s important to note here that no money can be involved in order for you to deduct sales tax.
Loaned vehicles may also be exempt from sales tax in Florida. These include vehicles loaned to high schools or institutions with a driver’s education program. To be a loan, it must have a license plate indicating this. Or if a vehicle is loaned to someone while their car is being repaired, it is considered a loaner.
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