Increases in charges by the Victorian Transport Accident Commission (TAC) and fees under the Road Safety Act 1986 affect Licensed Motor Car Traders (LMCTs) who sell motor vehicles on a 'drive-away-deal' basis.
There has also been an increase (effective 1 July 2012) in the rate of duty (from $5 to $6 per $200 or part) on an application to register a new or near new passenger car, the dutiable value of which is below the Commonwealth's luxury car tax threshold.
The following guidelines are to be used in calculating the dutiable value of new and used motor vehicles sold as part of a 'drive-away-deal' where the date of registration or transfer of registration is on or after 1 July 2012.
The following factors must be considered when calculating the dutiable value of a motor vehicle that is subject to a 'driveaway-deal':
- any trade-in allowance is not to be deducted from the dutiable value of the 'drive-away-deal' price
- if an agreement for sale was entered into before an application for registration or transfer of registration is made, the value of accessories or options to be fitted to the vehicle (including protective products or vehicle additions) must be included in the dutiable value of the 'drive-away-deal' price. This is regardless of whether the accessories or options are ordered or invoiced separately to the vehicle
- dealer delivery fees must be included in the dutiable value component of the 'drive-away-deal' price, and
- there is to be no discount on the dutiable value of the 'drive-away-deal' price for the amount of GST (if any) payable on the supply of the vehicle.
New vehicle sales
From 1 July 2010, as part of the 2010 State Budget, the Victorian Government aligned the thresholds for calculation of motor vehicle duty for new and near new passenger cars with the general Commonwealth luxury car tax threshold.
New vehicles may be sold as part of a 'drive-away-deal'. In order to calculate the dutiable value of the 'drive-away-deal', registration costs must be subtracted from the 'drive-away-deal' price with the balance then divided by the Relevant Dividing Factor (as set out in Table 1).
Please note that the registration costs listed in Table 1 are to be used, irrespective of whether the actual registration costs of the vehicle are of a lesser amount.
Former demonstrator vehicles
Duty is payable upon an application for the transfer of registration of a demonstrator motor vehicle (which is a passenger car) pursuant to the rates set out in Table 1. For the purposes of Table 1, a demonstrator motor vehicle is a motor vehicle that was:
- initially registered in Victoria in the name of an LMCT that has not been previously registered elsewhere, and
- within 60 days of initial registration of the motor vehicle, no duty has been paid in relation to:
- an application for registration or transfer of registration of the motor vehicle, or
- as a result of the change of use of the motor vehicle.
Used vehicle sales
Sales of used vehicles on a 'drive-away-deal' basis are not as common as they are for new vehicles. However, the formula used to calculate the dutiable value for 'drive-away-deal' sales of used vehicles is the same as that described for new vehicles.
Please refer to Table 1 for the rates used to calculate the dutiable value of used vehicles and Table 2 for examples of calculations of the dutiable value of 'drive-away-deals'.
Refer to tables over page
Table 1: Figures used to calculate dutiable value on 'drive-away-deals'
|Type of Car||'Drive-away-deal price (including registration)||Registration costs to be deducted||Relevant Dividing Factor to convert 'drive-away-deal' price to dutiable value|
|New||More than $61,635||$728.50||1.050|
|New hybrid||More than $61,635||$628.50||1.050|
|Used||No price threshold||$34.50||1.040|
|*The Registration cost and Relevant Dividing Factor also apply to all non-passenger vehicles regardless of the 'drive-away-deal' price|
Table 2: Example calculations for dutiable value of 'drive-away-deals'
|Example 1 New car||Example 2 New hybrid car||Example 3 New car||Example 4 Used car||Example 5 Used car|
|Less registration cost||$728.50**||$628.50**||$728.50**||$34.50||$34.50|
|Divide by Relevant Dividing Factor||1.030||1.030||1.050||1.040||1.040|
|Rounded up to the nearest $200||$18,800||$52,400||$69,000||$19,200||$60,200|
|**The registration costs for new vehicles are based on the motor vehicle registration costs for passenger cars in the High Risk Zone (code 101)|
Table 3: General rates of duty for motor vehicles
|Type of vehicle||Dutiable value||Rates of duty|
|New passenger vehicle***||$0- $59,133||$6 for every $200 or part thereof|
|New passenger vehicle***||More than $59,133||$10 for every $200 or part thereof|
|New non-passenger vehicle||No threshold||$5 for every $200 or part thereof|
|In all other cases (including used vehicles)||No threshold||$8 for every $200 or part thereof|
|*** This includes former LMCT passenger cars registered or transfer of registration within 60 days of initial registration which were previously exempted from duty|
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