When you're purchasing a new or used car, it's important to understand the taxes and fees you may face.
California statewide sales tax on new & used vehicles is 7.25%. The sales tax is higher in many areas due to district taxes. Some areas have more than one district tax, pushing sales taxes up even more. To find out the exact tax where you live, use this tool from the California Board of Equalization.
Here are typical fees:
DMV or State Fees
|New & used car sales tax||7.25%||Tax is higher is some areas.|
|Title Transfer Fee||$15.00||Pay within 30 days.|
|Title Only||$21.00||Cannot be used for vehicles with unpaid registration fees.|
|Rush Title||$15.00||An additional charge on top of the title fee to process the application within three business days.|
|Vehicle License Fee||0.65% of vehicle value||This is based on the original purchase price and decreases for the first 11 renewal years. It may be deducted from your state income tax.|
|Smog Transfer Fee||$8.00||Smog transfer fees are required on vehicles that are four or less model years old. The fee is collected from the new owner.|
|California Highway Patrol (CHP)||$26|
|Reflectorized License Plate||$1|
|Zero emissions vehicle parking sticker||$17|
|Documentation Fees||$80.00 and an electronic filing fee for each transaction||Dealers in the Business Partner Automation Program can charge this for vehicle-related transaction they perform at the dealership, such as assigning license plates and printing registration cards.
The dealer must provide a written document with the an itemized list of charges and credits, such as fees, taxes, service charges, downpayment and rebates (California Civil Code §2982).
|Extended Warranty||Varies||Usually a basic manufacturer's warranty comes with the purchase of a vehicle. The dealership may encourage you to buy an extended warranty, which is a service contract.|
|Advertising Fees||Negotiable||Check the invoice to see if your dealer is adding on fees related to their advertising. You may be able to negotiate these down or completely out.|
|Vehicle History Report Fees||Varies by provider||It's wise to get a vehicle history report when purchasing a used car. If your dealer doesn't provide one, there are plenty of companies you can use such as Carfax and AutoCheck.|
|Pre-sale inspection||Varies by inspection company||A pre-purchase inspection is often done for used cars. The purchaser usually pays. An inspection can uncover flaws that could change your decision to buy the car.|
Do you pay sales tax on a private party used car in California?
If you buy a used car from a private party sale in California, you may have to pay a “use tax.” A use tax is similar to a sales tax and collected for the use, storage or consumption of personal property (including vehicles) in California. You can calculate your local use tax rate here.
You may be exempt from a use tax in California if:
- The car was a family transfer sold between a parent, child, grandparent, grandchild, spouse, domestic partner or siblings (related by blood or adoption).
- The car was a gift (not including vehicles traded between individuals, transfer of contracts or other valuable consideration).
- You received the car through a court order.
- You inherited the car.
To apply for a use tax exemption, you will need to complete a Statement of Facts from the California DMV.
Updated Oct. 10, 2019