When you buy a car, the sticker price is only the beginning. Don’t forget about the sales tax!
This article will explain Florida’s car sales tax, including how it’s calculated, local surtaxes that might apply, and what happens if you buy a car out of state.
Understanding Florida’s sales tax on cars is essential for budgeting and avoiding unpleasant surprises at the dealership. Let’s dive in.
What is Florida’s sales tax for cars?
The Sunshine State charges sales tax on all new and used car purchases, and the base rate is 6%. This statewide tax is applied to the car’s purchase price, but the final tax amount can vary depending on a few factors.
Dealer discounts reduce the amount you’ll be taxed on, because the tax is calculated after the discount is applied. Trade-in allowances work the same way — the value of your trade-in is subtracted from the price of the new car to arrive at the taxable amount.
Manufacturer rebates, however, generally do not reduce the price used to calculate sales tax. This is an important distinction to keep in mind when you’re negotiating the final price.
Local sales tax on car purchases
In addition to the statewide sales tax, Florida counties can add a discretionary sales surtax.
County Surtaxes
This surtax is in addition to the 6% state sales tax, but it’s capped at 1.5% on the first $5,000 of the purchase price. That means the most you’ll pay in surtax is $75, no matter how much the car costs.
Examples of County Surtaxes
For example, Hillsborough County tacks on a 1.5% discretionary sales surtax.
Because surtax rates vary from county to county, it’s a good idea to check the rate in your specific location before you buy.
Calculating Florida Car Sales Tax
- Find the vehicle’s purchase price.
- Subtract any dealer discounts or trade-in allowances. Keep in mind that you can’t subtract manufacturer rebates.
- Multiply the adjusted purchase price by 0.06 to calculate the 6% state sales tax.
- See if your county has a surtax. If it does, multiply the first $5,000 of the adjusted purchase price by the surtax percentage (up to 1.5%).
- Add the state sales tax and the county surtax to find the total sales tax.
What other fees might I have to pay after buying a car in Florida?
On top of the sales tax, you’ll have to pay fees to transfer the title and register the car. You may also have to pay the dealership a documentation fee.
- Title fee: $75.75
- Registration fee: From $1.60 to $91.20, depending on the car’s weight
- Plate transfer fee: $7.85
All told, you can expect to pay about $181 in fees to the Department of Motor Vehicles.
Dealers also charge a documentation fee to cover the cost of preparing the paperwork. This fee can vary quite a bit from one dealership to the next, but you can expect it to average around $670.
The dealership may try to charge you for things like dealer preparation, so make sure you know what each fee covers before you agree to buy the car.
What if I buy a car outside Florida?
Florida charges a “use tax” of 6% on cars bought in another state but brought into Florida for use. But you’ll get credit for any sales tax you already paid in the state where you bought the car, so you won’t pay double tax.
You also won’t have to pay the use tax if you used the vehicle outside of Florida for at least six months.
To Conclude
Understanding Florida’s car sales tax is essential to budgeting effectively. When planning your purchase, make sure you consider all applicable taxes and fees.
Remember to factor in both state and county taxes, as local surtaxes can significantly increase the total cost. For private vehicle purchases, contact the tax collector’s office to ensure you pay the correct amount.
By staying informed, you can avoid unpleasant surprises and make a well-informed decision about your car purchase.