Taxes and fees in used car transactions mainly include value-added tax, urban construction tax, education surcharge and local education surcharge.
Value-added tax:
General taxpayer: If the seller in a used car transaction is a general taxpayer, the input tax that has been deducted shall be subject to value-added tax at a rate of 17%, and the undeducted shall be subject to a simplified method of 4% tax rate at half the rate, that is, sales multiplied by 4%/.
Small-scale taxpayer: If the seller is a small-scale taxpayer, the sales of used motor vehicles shall be subject to a reduced value-added tax rate of 2%.
Special circumstances: If the seller is a taxpayer approved to engage in used car distribution business, the value-added tax rate can be reduced to 0.5%.
Urban construction tax, education surcharge and local education surcharge: These taxes and fees are usually calculated based on the amount of tax refundable for value-added tax and consumption tax, and are levied at the applicable tax rate.
Stamp duty: Sales contracts are taxed at a rate of 0.03%.
Corporate income tax: It will be treated as income from the transfer of property, with a tax rate of 25%.