23 Feb 15
Think you’ve got a great deal on your used vehicle purchase?
Remember, the final price you pay the seller won’t be your total out of pocket expense. Learn more about some of the other costs that are associated with purchasing a used car.
A nominal fee ($31 in NSW) is required to transfer the registration of the car from one holder to another. In Victoria, this cost will be around $36.40 to transfer the registration via a private sale, but will be cheaper (around $18.50) if the car is purchased from a dealer. In Queensland and South Australia, transfers incur a cost of $24.45 and $22 respectively.
However, keep in mind that some private sellers choose to sell their cars as the vehicle registration is about to or has already expired to save on the costs of renewal. Regos are transferable for up to three months after expiration. Also keep in mind that if you will be registering the vehicle in a different state, other charges will apply.
This is probably the most substantial additional cost that most car buyers will encounter. Stamp duty is due to the Government at the time of purchase and the cost will vary depending on the state and the cost of the car, and is always calculated based on the GST inclusive cost of the vehicle. Similar to home purchases in most Australian states and territories, car stamp duty is generally calculated on a sliding scale, becoming a greater proportion of the vehicle cost as the purchase price increases.
LCT is a tax of 33% on luxury cars sold or imported where the value of a car exceeds the LCT threshold (visit the ATO site for threshold information). Used vehicles that exceed the threshold currently set at around $62,000 (with a few exceptions, such as for more fuel efficient models). The tax of 33% is calculated on the value of the car that exceeds the threshold.
Don’t forget that if you own a vehicle you are required to have third party vehicle insurance even if you don’t plan on being on the road. You will need to arrange for this before you can register the car. This is an additional expense to factor into your car purchase considerations.
While not a required cost, it’s worth it to purchase a vehicle check on the car's history when you purchase your used car. For just $36.95, you can run the Vehicle Identification Number (VIN) through a number of state and national databases to find out if a vehicle carries any encumbrance, has been written-off or stolen, as well as getting a list of all known odometer readings to ensure that the car you’re buying is what the seller says it is.
Find out what the comprehensive CarHistory report is all about on our CarHistory Report page.