July 18, 2019

Car sales tax 2019: paperwork, how to prepare?

The number of cars in Poland is growing from year to year. It is estimated that as many as 62% of us drive a car every day. These are mostly commuting and child-riding for school, kindergarten and additional classes. In recent years, our approach to the age and technical condition of the vehicle has also changed. We spend our savings more and more willingly and take loans or non-bank loans to buy a younger and better car. The demand for brand new cars also increased.

So if you plan to buy a better car, you will also have to sell the previous one. Some road users are already old drivers, who have already had more than one replacement vehicle, but not everyone is so experienced. And the sale of a car is a situation that often puts our nerves in a difficult test. We know, we want to get as much as possible, and a potential buyer who took eg a non-bank loan and has limited options, wants to buy as cheaply as possible. Oh, ordinary conflict of interest. Car sales are also a large dose of mandatory formalities, so it’s worth it to be prepared so that there are no surprises.

How to prepare step by step for selling a car?


  1. Market analysis . It should start with reviewing portals with motoring announcements.  Filter them so that the result corresponds to the parameters of your car. First of all, the model, version, year, capacity, type of engine and power are important. You can also add important advantages to the filter, such as air conditioning, built-in navigation, heated seats, reversing sensors, etc.
  2. Price fixing . When a list of such or similar items appears, compare the prices and set your own. Also add the amount that will be negotiated. Some sellers at the beginning give a much higher price, hoping that it will sell enough. You can try and sometimes succeed, but in most cases the market verifies such prices and there is simply no interest in such a car.
  3. Announcement . Once you know how much you want to sell your car, post an ad. Today, car exchanges are falling into oblivion, the majority of sales are based on internet advertisements. Take nice pictures, work on the description of the benefits of the vehicle. It is micro-scale marketing, the better you do it, the faster sales. We advise against giving untruths, because you can have serious problems afterwards.
  4. Documents . Prepare documents in one place, ie vehicle card (if available), proof of purchase or contract, service book (if you have it), spare keys and any bills for repairs or modifications. Also, print a contract for the sale of a car 2019 in blank, which you will find on the internet, preferably several copies. When the potential buyer suddenly appears, everything will be prepared.
  5. Cleaning . Prepare the vehicle for sale. Take out all your personal belongings from him. If some of them have to stay, because you are using the car on a regular basis, gather them in one place, for example in a basket or bag. Clean up the car, mess and bad smell are the first disadvantages that deter the viewer.
  6. Small repairs . It is worth to lean on it, because the faulty doormat, lack of light in the cabin, a broken knob or a broken seat adjustment mechanism do not require much effort. However, they are always a reason to negate the technical condition of the vehicle and negotiate the price.

We are finalizing the car sale transaction

We are finalizing the car sale transaction

Once a specific buyer appears and you manage to finish the market, it means that it’s time for formalities. Write down the car purchase and sale contract, necessarily in duplicate. It should contain the minimum full details of the buyer and seller (name, surname, address number of the proof, Pesel), price and description of the subject of the contract (model, year, registration number and VIN number). Who is who, for how much and what.

Many car sales contracts also include a record that the buyer has read the technical condition of the vehicle and does not make any comments. However, it is worth remembering that in the case of car defects that we conceal, and which expose the buyer to large expenses, this provision in the court is not effective protection for the seller.

Both parties must sign the contract, and for mental comfort it is worth having a witness when it is concluded. After that, you only have to convert your money well and give a set of documents that you have previously received.

Additional issue – insurance policy

Additional issue - insurance policy

When selling a car, the vehicle insurance should be agreed with the buyer and an appropriate record should be included in the contract. The buyer can take over the policy of assignment by the seller, which is also worth including in the price, especially when the period of active protection is still long. He can also give it up and then a special statement is needed. On its basis, you will then terminate the policy for the vehicle sold, and the insurer will refund to you the unused insurance amount, calculated pro rata annually.

The car sold and what now?

The machine was able to sell, even at a good price, nothing to just enjoy. But there are a few more formalities to be observed.

Insurance . Regardless of whether the buyer has decided on your policy or not, you must report to the insurance company that you sold the vehicle. You can do it right away, because most companies already support such online applications. Usually, just a short information or fill out a special form and scan the buyer’s statement.

Unregistering the vehicle . There is also a visit to the commune office, in the communication department, where your car is registered. Theoretically, this is not a legally enforced obligation, but only a recommendation of the office, but it is worth doing. In the case of an event involving a car sold or stolen, you will not need to explain anything. The more so because the de-registration of a car after sale is really a simple, simple form and receiving the decision to de-register the car. And zero costs.

Car sales tax . It is simply a personal income tax. This obligation arises when we sell the car within 6 months of purchase. Importantly, this period is counted only from the end of the month in which we buy the vehicle and not from the specific date of purchase. The obligation to tax this activity arises even in the case when we do not earn or even lose sales. And so you have to pay a possible income tax on natural persons. Settlements are made with other incomes using the tax return PIT-37, and in the case when we additionally run a business, PIT-36. I am talking about selling cars from private owners, of course. Currently, from February 15, 2019, we have a novelty, the Tax Administration has implemented an automatic settlement of our tax returns. And that there are only revenues known to the US from employers’ statements PIT-11, all additional must be given independently. Therefore, a person who sold a car in the fiscal year 2018 before the said 6 months must manually add this income. What does this mean in practice? You have to log in at podatki.gov.pl and manually add the amount in the “other income” column. The taxable amount is the taxpayer’s income, i.e. the difference between income and tax deductible costs. And this method should also be adopted when calculating the car sales tax. The amount of the sale should be deducted from the purchase amount of the vehicle and any costs of purchasing parts, repairs and upgrades, provided that they are documented. Even if it goes to 0, you must enter it. The very stamp duty for the car, and in principle for its sale, is calculated jointly with the tax on other income. To add this amount to the internet portal, we have until 30 April, or you can send a traditional paper declaration to the Tax Office at that time. However, for failing to do so, the taxpayer will be punished sooner or later, and fines start at PLN 168 and end with PLN 33,600.

It should be remembered that the sale of a car after the end of the above-mentioned six months does not create a tax obligation and you do not need to add this amount to the testimony.

written by Suzan Hynes - Posted in Tax


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