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If you are thinking of buying a new car you are probably looking for deals at dealerships. Surely you have imitated several models and you have set a maximum budget to buy your new utility. However, it is likely that you have not taken into account the taxes to pay when buying a car . These should be part of your calculations since many of them will have to be paid each year along with the letter of the vehicle.
At Tzedakah House we want to help you get to know them better and become part of your budget . In this way you can make a calculation much closer to reality.
Taxes to pay when buying a car
Registration tax
This tax is responsible for taxing the registration of the vehicle. Luckily we will have to pay it only once. It must be paid whenever we register a vehicle for the first time within our country. Regardless of whether it is new or second hand.
There are certain tax exemptions and reductions in this type of tax. At a general level we can say that the registration tax is paid:
- Depending on the C02 emissions generated by the vehicle , which will define the type to be paid. The Air Quality Law is in charge of determining the percentage that must be applied to the vehicle according to the emissions it generates. So.
- Those vehicles with less than 120 g / km of C02 or that total, will pay 0%.
- Vehicles whose emissions exceed 120 g / km of CO2 but are not greater than 160 g / km of C02 must pay 4.75%.
- When the vehicle generates 160 g / km of CO2 and less than 200 g / km of C02, the percentage will be 9.75%.
- The percentage will reach 14.75% when emissions are greater than 200 g / km of CO2.
In other words, the more a car pollutes, the more expensive the registration tax will be.
- The type of vehicle in question. This characteristic will define the taxable base on which one or another amount of VAT must be paid.
VAT on new vehicles
As with other products that are purchased for the first time, vehicles are subject to VAT. The VAT corresponding to this type of good is 21%.
However there are exemptions and reductions on this tax.
- Official vehicles and those of the Armed Forces . These vehicles do not have VAT.
- Vehicles for people with disabilities . In these cases the VAT is 4%. This reduction is applied to vehicles whose users have reduced mobility or to vehicles used to transport people with physical disabilities. 4% VAT is also applied to those users who have a disability greater than or equal to 33%. This does not have to be physical.
If the vehicle is bought by a freelancer or acquired for business use :
- 100% can be deducted in quarterly returns as long as the use is exclusive to the company.
- In the event that the use is combined, 50% will be deducted.
The Property Transfer Tax
Do not think that by buying a second-hand car you will get rid of paying taxes. Although VAT is not applied in exchange, you have to pay the Capital Transfer Tax. In this case, the seller must pay personal income tax for said sale if he obtains any type of profit from it.
How the Property Transfer Tax is calculated
The Property Transfer Tax is directly related to the value of the vehicle. To calculate this value, the official tables provided in Royal Decree 1/1993 are used . To calculate the tax we use the highest value price of the vehicle. This may be the one established by the Ministry of Industry through its tables, or the one that we have paid for the car.
A multiplier must be applied to this value that will vary depending on the age of the car.
- For cars over 12 years old the percentage is 10%
- From 11 to 12 years the percentage is 13%.
- If the vehicle is between 10 and 11 years old, the percentage will be 17%.
- If you are between 9 and 10 years old, this percentage will rise to 19%.
- If you are between 8 and 9 years old, the percentage will be set at 24%.
- In the event that the vehicle is between 7 and 8 years old, we will speak of 28%.
- If I were between 6 and 7 years old, we would reach 34%.
- For cars between 5 and 6 years old the percentage is 39%.
- With cars between 4 and 5 years old the percentage rises to 47%.
- Between 3 and 4 years we would reach 56%
- For vehicles with an age of between 2 and 3 years we would reach 67%.
- In 2-year-old vehicles the percentage will be 84%
- And finally, in vehicles that are one year old, the percentage will be 100%.
The value that we obtain from this multiplication will be the actual tax base of our vehicle. On this basis, the tax percentage will have to be applied, which will vary between 4% and 8% depending on the power of the vehicle and its age.
The Circulation tax
Anyone who has a vehicle must pay this tax . The technical name of this tax is Tax on Mechanical Traction Vehicles. It is a general tax that the municipalities control. That is, they are the ones who impose one or another expense. However, depending on Royal Decree 2/2004, there are exceptions. For example:
- For collector vehicles.
- On those vehicles that are deregistered.
- The vehicles of the public administration, foreign consulates or diplomats that can circulate in our country.
- Vehicles to transport people with reduced mobility.
- Ambulances, minibuses and buses.
- Trailers or tractors with Agricultural card.
How to calculate road tax
Both the ecological level of the car and its power are used to calculate the tax. Each city council can tax it more or less depending on these conditions.
This tax must be paid every January 1 and has an annual duration.
Wealth Tax
It must be taxed as an estate tax for those citizens whose assets reach $ 700,000. This amount does not include the habitual residence up to a maximum of $ 300,000.
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