Are there any taxes paid on a demonstrator? Possibly. A vehicle may be used for demonstration purposes for six (6) months only. If used for more than six months, use tax will apply based on the cost price of the vehicle. In addition, if a demonstrator is driven for personal use by someone who is not an officer or employee of the dealership, use tax will apply. https://files.constantcontact.com/4cd3539c001/ 460da04a-93b8-4a00-91ba-9f53a151322a.pdf Is a demonstrator that has not previously been titled considered a “new” vehicle when sold to a retail customer? No. Although a demonstrator that has not been previously titled is considered a “new” vehicle for purposes of Georgia’s titling laws, a demonstrator is deemed a “used” vehicle purposes of the FTC Used Car Rule. Therefore, a demonstrator vehicle must be sold as “used” and requires both a Monroney label and an FTC Buyer’s Guide. GADA Word of Warning: Use of dealer tags by Georgia dealers has come under heightened scrutiny recently due to perceived abuses, particularly in the used car market. Please ensure your dealer tags are being used only for the purposes allowed. RENTALS My dealership provides vehicles to service customers for a charge. Are these vehicles subject to TAVT? Yes, because customers are charged to use these vehicles, they are rental vehicles. Rental vehicles must be titled and tagged in the name of the dealership or dealershipaffiliated entity and TAVT must be paid. I heard that there is a discounted TAVT rate for rental vehicles. Is this correct? Yes. A discounted TAVT rate of 1.5% is available to entities that are certified by GADOR as “rental motor vehicle concerns.” What is required to be certified by GADOR as a “rental motor vehicle concern?” To be eligible for certification as a “rental motor vehicle concern,” the following conditions must be met: • In the prior calendar year, must have an average amount of sales and use tax attributable to the rental charge of each rental vehicle of at least $400 • Vehicles are rented for 31 days or less • Vehicles carry 10 or fewer passengers • Vehicles must be used primarily for transportation of people • Must maintain an average of five (5) rental vehicles What form do I use when I apply for certification as a “rental motor vehicle concern? GADOR Form MV-15 must be used to apply for rental motor vehicle concern certification. https://dor.georgia.gov/mv-15-rental-certification-affidavit GADA Word of Warning: If you are charging customers for a “loaner” vehicle, it is not technically a loaner vehicle under Georgia TAVT law — it is a rental vehicle and would be subject to TAVT. This article is intended for informational purposes only and is not intended to be legal advice. Dealers are advised to seek advice from dealership legal counsel or other competent professionals concerning dealership operations and regulatory compliance. The presentation of this article is not intended to encourage concerted action among competitors or any other action on the part of dealers that would in any manner fix or stabilize the price or any element of the price of any good or service. THE GENERATOR 24
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