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sale of second hand car

vinit (nasik) (56 Points)

28 September 2017

the gst rate for sale of second hand car

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anonymous (student) (750 Points)
Replied 28 September 2017

There are two sides to this question.

1) Consumer selling used products to registered/ unregistered dealers:

You, as one consumer, may sell the used car to another consumer (read “unregistered person”) who is buying it for her personal purpose.

In this case, GST does not apply.

This principle applies when you sell your vehicles over platforms like CARTRADE or OLX.

2) Unregistered businessmen selling used products to registered dealers:

In this case, buying and selling of used products is your trade but you are unregistered due to a turnover less than Rs 20 lakh. Then the registered dealer has to pay tax (only the SGST part) on his purchases on reverse charge basis on the seller’s behalf. But he cannot take input tax credit on the same. The tax rate for new and used products are the same. Only the value on which the rate is applied differs.

The general tax rate for cars is 28% with the a variable levy of cess ranging from 1% to 15%.