Tax refund when buying a car in 2021

Drawing up a VAT return

First, decide on the total amount of tax payments to be refunded. For this purpose, the tax on product sales for the corresponding period is calculated, plus the tax that must be paid when purchasing goods, performing work or providing services.

Important!

If, when preparing a declaration, the total amount of tax paid turns out to be greater, then the tax can be refunded.

To receive a tax refund, you must submit a VAT return by the 20th day of the month following the reporting quarter.

To confirm the reimbursement of VAT from the budget, tax authorities conduct a desk audit of the submitted declaration. During an inspection at a legal entity in accordance with Art. 172 of the Tax Code of the Russian Federation, documents may be required confirming the legality of the use of tax deductions.

To speed up the process, it is better to prepare and submit these documents yourself. Upon completion of the inspection, a report is drawn up in the form approved by the Federal Tax Service.

When buying a car on credit

Under current laws, individuals who purchased a car cannot receive a tax refund. This rule applies both when purchasing a vehicle with your own money and on credit. It does not matter where exactly the car was purchased - in a specialized store or second hand. Receiving a tax refund is possible only when selling a vehicle if the cost exceeds a quarter of a million.

Refund of indirect deductions is possible only at the end of the tax period for legal entities that have the obligation to transfer VAT to the budget of the Russian Federation. You can return part of the deductions if the property was purchased with your own funds, using a loan or leasing.

Receiving a refund is possible only if several conditions are met - the funds must be used for business, which must be confirmed. All vehicle documents must be correctly drawn up.

VAT refund for purchased car

If the tax authority decides to refund the VAT, then the next day a written order is sent to the Federal Treasury authority for territorial subordination.

The Treasury, within five days after receiving the order, returns the VAT amounts and notifies the Federal Tax Service about this.

After this, Federal Tax Service employees are required to inform the taxpayer in writing within five days about the decision made on a full or partial refund or credit of VAT. If a refund is refused, the Federal Tax Service sends a reasoned decision, which can be appealed by the taxpayer in court. This message is received by the head of the legal entity or his representative by mail or against signature.

Who can get a tax deduction for car transactions?

As a rule, all income of citizens of our country is taxed. In car purchase and sale transactions, the car seller can count on a tax deduction, since it is he who receives income from the sale of the car. If you already own a car and you are going to sell it, but under certain conditions you can count on a tax deduction to pay tax at all.

Nowadays, quite a large number of people prefer to purchase used vehicles, since such a purchase is much cheaper. But if you can’t do without financial help from a bank, then the question often arises about where it’s better to buy a car on credit if you need a used one.

If you decide to buy a car from an individual, he will be able to count on receiving a tax deduction only if he has been the owner of the car being sold for no more than three years.

According to the Tax Code of the Russian Federation, profit received from the sale of real estate or movable property is taxed depending on the period of operation.

Speaking specifically about cars, it is worth paying attention to the following example:

the car has been your property for less than 3 years,
you sell it for 500,000 thousand rubles,
the tax amount, in accordance with the law, is 13%,
therefore, you are obliged to pay the state 65,000 rubles without taking into account the tax deduction.

After selling the car and paying the tax, you need to collect a package of documents and contact the tax authorities at your place of residence. It’s worth noting right away that if you initially decided to take out a car loan from a bank, and now you are going to sell the loaned car, then this can only be done after the debt has been completely closed. A pledged car cannot be sold, so if the car loan term is more than three years, then either repay the loan early or sell the car after the debt is fully repaid.

List of documents for obtaining a tax deduction

When selling a car, you must save all documents that were involved in the transaction. To receive a tax deduction you will need:

certificates confirming the time during which the car was in your ownership (more than three years or less);
car purchase and sale agreement (you must draw up two copies of it in advance so that one remains with you);
a copy of the vehicle's passport with a note stating that the car is no longer your property;
payment documents - checks, receipts stating that you received a specific amount of money from the buyer;
declaration in form 3-NDFL;
application for a tax deduction when selling a car.

This list of documents must be submitted to the tax authorities at your place of registration.

How much will the tax amount be reduced due to the property deduction?

Despite the fact that a tax deduction when buying a car on credit or for cash is not provided for by law, when selling a car, even on credit, thanks to it, you can reduce your tax payment. The tax deduction allows you to reduce the amount of tax paid on the profit received after selling a car and amounts to 250,000 rubles, provided that you have owned the car for less than 3 years. It is worth adding that this amount should not be confused with the amount of compensation. This means that exactly this amount of money from the entire proceeds from the sale of a car is not subject to tax. In other words, an amount of 250,000 rubles will be deducted from the total cost of the car sold, and tax will be charged on the remainder.

For a clear example, consider the following numbers:

the cost of the car being sold is 600,000 rubles,
taking into account the tax deduction, the taxable amount will be 350,000 rubles (600 – 250 = 350),
as a result, 13% of the tax will be written off from 350,000 rubles and you will have to pay 45,500 rubles instead of 78,000 rubles.

Thus, after paying the full tax, you will get 35,500 rubles back.

If you bought a car more than three years ago, the tax deduction will be equal to the cost of the car being sold. Therefore, the amount received for such a car is not subject to taxation.

Many Russian residents do not want to pay a tax of 13 percent of their salary to the state budget, because they believe that they could spend this money at their own discretion. That is why many people are wondering how to return income tax from salary. Let's see if there are legal ways to get a refund. Table of contents

Return methods

Standard deductions
Social deductions
Property type tax deduction

Who is eligible for a 13 percent income tax refund?

Refund methods One of the most popular ways to return 13% payroll tax is to use some kind of tax deduction.

Nuances when refunding VAT after purchasing a car

To receive a refund of the paid tax, a legal entity must submit a complete package of documents without violating the deadlines specified in the law.

Important!

All invoices and source documents must be completed correctly, and the company must not have any underpaid taxes. Otherwise, the refund amount will be used to pay off tax debt.

Qualified lawyers specializing in tax legal relations will help you correctly understand all the issues of VAT refund for a purchased car. They will prepare the necessary documents and do everything necessary to receive the money due to the legal entity.

ATTENTION!

Due to recent changes in legislation, the information in this article may be out of date! Our lawyer will advise you free of charge -
write in the form below.

Myth and reality

It turns out that VAT refund when buying a car for personal purposes is a myth, because... an individual does not pay VAT and, accordingly, does not have the right to return it. But legal entities and individual entrepreneurs who are VAT taxpayers can return VAT on the purchase of a car if they use it directly in business activities.

That's all it seems. Don't be afraid of anything, formalize the deal legally and everything will be fine.

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Is it possible to return 13 percent from the purchase of a car in 2021 by comments

According to the above rule of law, such property includes:

purchased apartment, room, house, or shares in them;
a plot of land purchased for the subsequent construction of residential real estate, or located under an already built house;
built residential building, share in it.

If the car was owned for less than three years, then the amount received from the sale can be reduced by the amount of tax.

So, for example, if a car was sold for 300, and the amount of the tax deduction for 2021 is 250 thousand, then the difference will be 50 thousand rubles.

This is the amount on which no tax is paid. In other words, if the amount from the sale of a car is no more than 250,000 rubles, the 13% tax is not paid.

the car must be new;
the car must be domestic or a budget foreign car produced in the Russian Federation;
the deduction amount should not exceed RUB 500,000;
the deduction must be provided only once.

To receive personal income tax reimbursement for a special property deduction, you will need to comply with one important rule

If a person bought a plot of land for the development of his own housing (private house/cottage/other residential premises);
If a citizen pays for commercial full-time education, he needs additional funds;
If a Russian citizen took out a loan for the development of a plot of land (construction of residential premises, as well as its renovation) and he needs additional funds to repay the interest on the loan;
If a citizen receives expensive treatment in a hospital or other medical institution;
If a person sent part of the funds to charitable foundations;

As can be seen from the above list, vehicles are not included in the list of property items from the purchase of which thirteen percent are returned to their owners.

A person can use it only once, and a situation is also acceptable when he has the remainder of the purchased home at his disposal.

Legislation

You can find the answer in the Tax Code of the Russian Federation:

In paragraph 1 of Art. 220 of the Tax Code of the Russian Federation contains a list of property for which you can receive a deduction.
If we rely on subparagraph 3 of paragraph 1 of Article 220 of the Tax Code and letter of the Ministry of Finance of the Russian Federation dated May 21, 2010 No. 03-04-05/9-277, there is no information about vehicles in this list.
Letter No. 03-07-14/45360 of the Ministry of Finance of the Russian Federation dated July 17, 2017 regulates the procedure for VAT refund to legal entities.

In 2015, deputies of the LDPR party prepared a bill to include transport in the list of property for which income tax can be refunded. But at the same time a certain list of criteria was compiled:

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The car must be new.
The car was produced by a domestic plant or it is a Russian-assembled foreign car.
The amount of payments cannot exceed 500 thousand rubles.
Reimbursement is a one-time event.

A list of brands and models purchased by a citizen for the first time at a car dealership was compiled. Thus, the creators of the bill wanted to stimulate consumers to buy domestic cars for the development of the Russian automobile industry.

However, the amendment has not yet been adopted. If it is reviewed and approved in 2021, it means that payments will begin to be made from this period, but for now there are no changes in the law.

For reference! According to the law, you cannot get a deduction for buying a car, you can only get it for selling it.

General procedure for processing documents

To carry out income tax manipulations, you need to make sure that all documents are in order. Many people treat automobile papers not as responsibly as those that belong to apartments and various real estate properties.

The tax organization will most likely need to provide the following important papers necessary to resolve the issue of how to receive a refund:

PTS with strictly fixed information data regarding the transaction. As soon as the data for the new owner is entered into the passport, it is better to make a copy of it.
An official agreement on a transaction, in particular on the sale of a car, where the amount from the sale of the car is clearly stated.
Documents from a financial institution. This may include an account statement where, after the sale, funds from the sale were transferred; all necessary payments, receipts, receipts and checks will be required. In other words, confirmation of receipt of material funds will be required.

As soon as the vehicle is sold, the owner must submit a 3-NDFL declaration. This must be done before April 30, regardless of whether income tax is being refunded or charged.

Until July 15 of the year following the reporting year, that is, the one in which the transaction was carried out, you will need to pay personal income tax.

In the process of drawing up and submitting a declaration of income received and a correctly written statement from a legal point of view, you need to make copies of documents, but also be prepared for the fact that you will need to present the originals.

It is also strongly recommended not to take the designated deadlines for submitting documents lightly.

The question of whether it is possible to submit a declaration later than the deadline, for example, next month, can only be answered in the negative.

In 2021, a sanction penalty may be imposed for violating the deadlines for completing and submitting documents to a tax organization.

This also affects subsequent more serious civil liability, which can sometimes reach legal proceedings.