Frequent amendments made to legislation sometimes lead to the emergence of many questions, among which the tax deduction when purchasing a car is considered particularly relevant. Law-abiding citizens have already had the advantage of seeing the attractiveness of a tax refund, especially in the field of real estate purchases, and therefore a 13% refund on the purchase of a vehicle seems quite reasonable.
Tax deduction when buying a car
Features of tax deduction
Every month, 13% of the salary is withheld to the state. This paragraph of legislation is mandatory for all tax residents of the Russian Federation. However, these funds are not spent exclusively on the needs of the state: part is returned to citizens under certain circumstances.
Among the benefits provided by legal norms is a tax deduction, which is a mechanism for refunding income taxes.
Entities who have paid tax and made any expenses during the calendar year can get back the withheld 13%. In some situations, the period implying the possibility of payments extends to 3 years.
Unfortunately, not all expenses fall under the attractive 13% rebate category, for example, groceries or household appliances are not included in this list. You can use this option under the following circumstances:
- purchase or construction of real estate;
- payment for education;
- completing a treatment course;
- material participation in charitable events.
Purchasing a car theoretically falls under 1 point, which is deciphered as follows:
- purchasing a plot of land, a private house or apartment;
- construction of residential real estate;
- payment of interest under the loan agreement for the purchase of all of the above.
In accordance with tax law, the property deduction covers only the purchase of real estate. Because these expenses are considered essential, exemptions apply. However, a car is not considered by law as an essential item, so it is not possible to return 13% after purchasing it.
The Tax Code of the Russian Federation does not provide for a tax deduction for the purchase of a vehicle
Why can’t you claim a deduction in 3-NDFL when buying a car?
The state has so far given a negative answer to the question of whether 3-NDFL applies to the purchase of a car. There is no deduction allowed, even if the car was purchased for a very small amount. Or vice versa - it costs a lot of money (sometimes more expensive than housing) and thereby gives its owner a certain social and/or professional status.
Thus, when discussing filling out 3-NDFL when buying a car, one cannot draw a direct analogy with real estate purchase transactions. In particular, apartments, rooms, etc. It is believed that by taking ownership of them, a person solves his housing problems. But the same cannot be said about buying a car.
Also see “How to reimburse personal income tax for purchasing an apartment.”
Read also
30.03.2017
How to get 13 percent back on a car purchase?
Since, as of 2021, a car is not on the list of purchases after which there is the possibility of a tax refund, it would be more correct to ask the question: how to save money when selling a car, since in some cases you can avoid paying tax.
First of all, the time between buying and selling a car should be spent wisely. To avoid any difficulties during the sales process, it is advisable to adhere to the following steps:
- keep documents confirming the original cost. It would be a good idea to have them notarized;
- record every cost associated with a car, right down to service in the showroom, as this will help set an adequate selling price;
- monitor the registration of the car and the payment of taxes: it is important that everything is completed correctly, because in the future, this will help in the rapid assessment of the purchase and sale transaction by the competent authorities.
After all the preparatory “pre-sale” nuances have been observed, you can begin to master the basic intricacies of the art of competent sales.
Video - Tax deduction when buying a car
What to do if the car purchase documents have not been preserved
Although you cannot get income tax back for buying a car, you need to be careful about filling out and keeping the transaction documents safe. In addition to registering the car, they may be required to resolve possible disputes with the seller, as well as to obtain a deduction for a subsequent sale.
Loss or destruction of documents will have the following consequences:
- when contacting the traffic police, you will receive a legal refusal to register the car, since the fact of transfer of ownership will not be confirmed;
- claims cannot be made against the seller if significant defects are identified in the car;
- Without purchase documents, you will not be able to take these expenses into account when subsequently selling and calculating personal income tax.
Note!
If the period of ownership of the car exceeds 3 years, documents on expenses incurred will not be required. However, having a car purchase agreement will help you avoid problems during the sale.
Tax subtleties of car sales
In some cases, favorable conditions for the sale of vehicles are provided for car owners. You just need to arm yourself with the necessary knowledge.
3 year rule
This option is the simplest and most popular: if the car has been owned for more than 3 years, there is no need to pay tax. In addition, the owner is relieved of the obligation to fill out and submit 3-NDFL.
Table 1. Car ownership period
| Way | Tenure period |
| Purchase | From the date of purchase |
| Inheritance | Date of death of the testator |
| Present | From the moment of signing the donation agreement |
If the car has been owned for less than 3 years, income tax must be paid when selling it, but there is the possibility of applying a deduction.
After completing the transaction, you need to adhere to the following plan:
- enter the necessary data into the tax return and take it to the inspector at the place of registration;
- If the amount of tax due is not covered by deductions, you must pay it.
If the vehicle was owned for less than 3 years, the declaration must be submitted in any case.
The tax deduction is designed only for vehicles costing up to 250,000 rubles. This point provides an undeniable advantage when selling a car donated or inherited.
The amount of 250,000 rubles applies to all cars sold in 1 year
Calculation examples.
In 2015, a car was purchased at a price of 460,000 rubles, the next year it was sold at a price of 600,000 rubles. Since the owner kept the original contract and receipts, there are 2 tax methods:
- by expenses;
- according to the standard deduction.
From the expense perspective, the tax that must be paid on the sale of vehicles owned for less than 3 years is calculated as follows: 600,000 - 460,000 = 140,000 rubles. It is this amount that is considered income and is subject to taxation: 140,000 * 0.13 = 18,200 rubles.
Using the deduction mechanism, the calculation will look slightly different: 600,000 - 250,000 = 350,000 rubles, which will be the amount to be withheld. Accordingly, the following calculation should be applied: 350,000 * 0.13 = 45,500 rubles. Since the amount of income tax paid is much less than the amount of the standard deduction, it is more advisable to use option 1.
Thus, there are 2 methods for calculating tax: based on the difference in value between purchase and sale, or based on an amount exceeding RUB 250,000. We should not forget that method 1 is only possible if you have a package of documents confirming the purchase of the car.
There are also situations that are more difficult to calculate. The subject owns 2 cars: one was purchased in 2014, and the other was donated by a family member in 2021. Then, in 2021, they were sold at the following prices: 1 for RUB 270,000, 2 for RUB 130,000. The total income was 400,000 rubles. Since both transactions were completed within 1 year, a deduction of RUB 250,000 can be applied in both cases: (270,000+130,000)-250,000=RUB 150,000. It is from this amount that tax in the amount of 19,500 rubles will be withheld. (150,000*0.13=19,500). If the cars were sold in different years, the calculation would look like this: 270,000 - 250,000 = 20,000 * 0.13 = 2,600 rubles. and 130,000-250,000= - 120,000 rubles. Accordingly, the income received from the second transaction is not subject to taxation.
Using netting
There is another non-standard option: offset when selling cars and real estate.
If in the same calendar year a car was sold and housing was purchased that falls under tax breaks, it is possible to compensate one tax for another
For example, for an apartment purchased for 1,000,000 rubles, and a car sold for 1,000,000 rubles. in the same year, this offset option is possible, since in the first case you can return 13%, and in the second case they must be paid. If an inherited car worth 1,000,000 rubles, the ownership period of which does not exceed 3 years, was sold, and housing was purchased for 1,250,000 rubles in the same tax period, the calculation is as follows:
- For the sale of a car, in relation to which a tax deduction can be applied, it is necessary to withhold tax: (1,000,000 - 250,000) * 0.13 = 97,500 rubles.
- A property deduction applies to the purchase of housing: 1,250,000 *0.13 = 162,500 rubles.
As a result, the amount of tax payable is compensated by the amount payable: 162,5000 - 97,500 = 65,000 rubles, it is this balance that is transferred to the owner after filing the declaration.
Luxury car tax 2021 car list list
If in 2015 189 models fell under the selection criteria, then this year the number of positions has increased to 280. You can view the full list of cars at the address on the Internet.
The same provisions are valid for leasing, but in this case, tax expenses are borne by the party indicated in the agreement (the lessor), this is clearly reflected in the Tax Code of the Russian Federation. At the same time, the law does not provide any explanations regarding registration with the traffic police. If we talk about the sale of such a car, then everything depends on the taxation system, if, for example, it is OSNO, then a ban is imposed on the sale up to its complete redemption.
Transport tax on cars in the Republic of Belarus from 2021
In Belarus there is a different form of calculation - it depends on the mass.
Passenger cars:
- more than 1.5 t = 3 BV (540 thousand Belarusian rubles);
- 1.5-2 t = 6 BV;
- 2-3 t = 8 BV;
- more than 3 t = 11 BV.
For trailers:
- up to 750 kg = 2 BV;
- more than 750 kg = 11 BV;
- caravan trailer = 5 BV.
Freight and cargo-passenger:
- up to 2.5 t = 8 BV;
- 2.5-3.5 t = 17 BV;
- 3.5-12 t = 22 BV;
- over 12 t = 25 BV.
Possible mistakes
When selling a car, many owners make serious mistakes in an attempt to evade paying taxes. Among the most common are the following:
- Refusal to fill out and submit a declaration in Form 3-NDFL , in which it is necessary to indicate the amount received during the sale process. When employees of the competent authorities discover the fact of sale, the owner of the car will be forced to pay 13% of the total cost, a penalty and a fine for concealing the fact of the sale.
- Underpricing. Often, owners deliberately set the cost of the car below 250,000 rubles in order to be able to take advantage of the standard property deduction, which exempts them from paying tax. Such actions can lead to problems when canceling a purchase and sale transaction. In addition, the reduction in value is beneficial only to the seller: if the new owner decides to sell the car at an adequate price, the income from the sale may greatly exceed the amount spent on its purchase, which can lead to tax payments.
After purchasing a car, the owner should not count on a tax deduction, however, legislation is constantly being improved, so it is possible that in the foreseeable future, vehicle owners will be pleasantly surprised by the benefits that have appeared.
Declaration
An attempt to file 3-NDFL for the purchase of a car will definitely fail. Tax authorities will simply ignore the 3-NDFL declaration when buying a car in 2016.
Accordingly, it is impossible to provide a sample of filling out 3-NDFL when purchasing a car/machine. There are simply no suitable lines in the form of this declaration to reflect this transaction.
True, in one case, when purchasing a car, the 3-NDFL declaration for 2016 will still be accepted. It is when:
- Last year, its sale took place at the same time.
- An individual sold his other car (there is a right to a deduction from the sale).
Note that in the latter case, when purchasing a car in 3-NDFL, it will not be declared. Only the sale will be reflected.
Also see “How to fill out the 3-NDFL declaration for the sale of a car.”
