A Doubt Regarding Vehicle Transfer Fee

songford on 06/05/2016 - 12:36
Last edited 06/05/2016 - 12:41

Hi ozbargainers,

Thanks to the kind assistance of heaps of good people here, I received a lot of advices on purchasing my first car from my last post, and now I'm negotiating prices with some potential sellers at this moment.

However, I have some doubts on the calculation of transfer fee and its implications.

According to Vicroads, the transfer fee is calculated from taking 4.2% of the amount of actual transaction that's involved in this deal. It sounds like there's a lot of loopholes in the definition of this article. In fact, there's a seller claimed that it is possible to put a much lower figure on paper in order to attract less fee.

Dodgy as it is, I'd like to know if there's any way the Vicroads will be able to verify the actual amount that is taking place between two private buyer and seller? What possible disadvantage (or aftermath) will it bring to me? Since I'm trying to settle a drive-away price with the seller and I'm trying to act honest. The thing is, even though I complain to him regarding this action, I have no way of ascertaining that he will actually put the correct figure on log with Vicroads I assume? I'm pretty sure Vicroads should have some ways addressing people doing this, since it sounds like a cheaper way out people taking all the time.

Thanks again for your help.

Automotive

Comments

  • [Deactivated] on 06/05/2016 - 12:49
    +1

    The transfer duty is based on one of the following:

    • If the value of the transaction is lower than the market value of the vehicle being transferred, the duty is calculated on the vehicle's market value; or

    • If the value of the transaction is higher than the market value of the vehicle being transferred, the duty is calculated on the value of the transaction.

  • tomsco on 06/05/2016 - 12:50
    +1

    Doesn't the buyer normally handle paying the transfer fees? As in the buyer has to take the document to VicRoads and pay it?

    Normally it's the buyer asking the seller to keep the listed price down.

    Regardless, unless the figure is significantly different to market value, I doubt they will check.

    • songford on 06/05/2016 - 12:54

      Even if the price is listed as drive-away price?

      Bugger. I thought if a price is drive-away price then the seller will cover all government fees including this transfer fee and stamp duty.

      Am I asking too much from the seller?

      Thanks for replying.

      • Euphemistic on 06/05/2016 - 13:17
        +1

        Are you talking about a new car?

        • songford on 06/05/2016 - 13:19

          No I'm talking about a 2nd-hand car. But apparently on carsales there are plenty 2nd-handed labelled as drive-away price.

        • Euphemistic on 06/05/2016 - 13:22

          @songford: Second hand they are all drive away, pay your money drive it away - to the rego office and pay your transfer fee.

          Dealers probably wont mark down the transaction price for duty because it's their livelihood at stake if they cheat. Private sellers will often mark it down for you to help out.

      • Evil-Elmo on 06/05/2016 - 16:06

        I thought if a price is drive-away price then the seller will cover all government fees including this transfer fee and stamp duty.

        In my understanding (and experience), drive-away price means the seller pays the transfer fees etc. like you've stated.

  • strikerzebra on 06/05/2016 - 12:59
    +1

    You may accidentally forget a 0 off the purchase price and pay less to transfer the vehicle .. an honest mistake

  • Kallo on 06/05/2016 - 17:16

    Recently purchased a bike in NSW and had to complete the transfer form.
    They have no way of checking the sale price.
    The lady at the counter didn't seem to care, and put in whatever price I had put in on the form.

  • Geewhizz on 07/05/2016 - 05:38

    If the seller is pushing you to have on the paperwork that you've paid significantly less than you have, I'd be very cautious. It's neither here nor there to him how much you pay in stamp duty.

    If your gut feeling is that it's dodgy, don't try to rationalise it, just walk away. There are plenty more cars out there.

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