Lease sales tax question (VA/NC)

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1

I live in Virginia and every lease quote I received in VA for a 2023 Ioniq 5 included a 4.15% Sales tax (upwards of $1700). I ended up leasing 24mo/12k from a dealership in North Carolina and they delivered the car to me in Virginia the next day for free.

The only tax in my leasing agreement is a $10/month “Sales/Use Tax” on the monthly payment breakdown and the sales person has assured me multiples times that I do not have to pay VA sales tax (only personal property tax) and they will register the car in VA for me and send me plates.

Does anyone have any experience with a similar situation? Maybe I will get a tax bill down the road? I can understand having to pay the tax if I buyout at the end of the lease and title it in my name, but what if I just return the car at the end of the lease?

2

You’re going to be billed the tax eventually. You can read about VA taxes on leasing in the following thread.

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Looks like they charged you NC 3% sales tax on monthly payments vs. 4.15 VA on the full price. You will be charged by VA, as Jon said.

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3% of the purchase prince would be around $1500 or about $60/month over the course of a 24 month lease. Not sure where the $10/month is coming from.

5

NC tax is 3% of the monthly payment. Ex would be $9/month on a $300 monthly payment.

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10101010101010

7

My bad. Thanks for the clarification.

8

Yes that dealer has no clue. NC does not have a sales tax but rather a “highway use tax” that is 3% on new car purchases, and as stated it only applies to monthly payment. They should have figured out your tax liability and set up in your state and done the payments accordingly.

From the calculator it looks like VA charges tax on the sales price, not the monthly payments, so you are likely to get a nice sized bill in the future.

This may get messy–you will probably need to do the math and make sure you get credit from VA for the taxes you are paying on a monthly basis–whether they are going to NC or VA.

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Yea, as soon as you try to register it in VA you’re going to get hit with the correct VA tax bill.

If you were planning to pay all of that up front anyways then probaly not a big deal, but if you were going to roll it all into the lease then you’re going to have a nice unexpected $1700 bill due.

If you did want to roll it all in then I would call the dealer ASAP, point out their error, and see if there’s any way they can rework it.

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The incompetence of finance departments at dealerships never ceases to amaze. I could see if they screwed up tax on some state 1500 miles away. But they share like 400 miles of border…

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Dealership told me today they were going to register it in VA for me and send me the plates. We will see what happens…

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Ask them to eat the difference. You agreed to a price based on your zip code. They screwed up. Couldn’t hurt to ask and maybe they will give you at least some additional discount. Your gonna be paying approx 1400 more then they quoted you…

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They told me over the phone and I have 2 separate emails stating I only need to pay VA personal property tax and No VA sales tax. guess that explains why it was such a good deal :rofl:

14

Thank your stars it wasn’t an EQS AMG

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@8sjson , would you mind sharing the details of the deal you got on 2023 ioniq 5? Was it SE or LE? Any dealer rebates?

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