When duty applies to vehicles, how it is calculated and who pays.
Motor vehicle duty basics
Unless an exemption applies, you pay motor vehicle duty when you:
- register a vehicle
- transfer the registration of a vehicle
- change the vehicle’s main use (for example, from demonstrator to service loan vehicle).
VicRoads collects motor vehicle duty for us when you register or transfer a vehicle. The duty amount depends on the type of vehicle, its value and the date you register it.
Motor vehicle duty applies to these types of vehicles:
- Passenger cars – built for up to 8 adults, including the driver.
- Other motor vehicles – motorcycles, vehicles built for more than 8 adults including the driver and vehicles designed to carry goods (including trucks, utilities and panel vans).
- Green cars – passenger cars with combined tailpipe carbon dioxide (CO2) emissions of 120 grams or less per kilometre.
- Primary producer passenger cars – passenger cars that will be:
- registered in the name of a primary producer
- used primarily in the person’s primary producer business.
- Heavy trailers (trailer or semi-trailer) with a maximum rated capacity exceeding 4.5 tonnes.
Rates and calculations
Motor vehicle duty is based on the type and dutiable value of the vehicle. The dutiable value is the higher of:
- the purchase price (including GST and luxury car tax), or
- the market value at the time of registration or transfer.
VicRoads does not assess or verify the dutiable value you declare. It is your responsibility to declare the correct value. We use a motor industry valuation guide to determine market value. If we find the value you declared was too low, we may send you a reassessment notice.
If you bought a used vehicle, the value is determined when you lodge the transfer documents with VicRoads, not when you bought it. If the vehicle has been improved before registration (for example, repaired to meet roadworthy standards), those costs are included in the dutiable value.
The value is rounded up to the nearest $200.
To work out how much duty applies, multiply the relevant duty rate by the dutiable value. View the current rates for motor vehicle duty or use the calculator to estimate how much duty you need to pay.
Exemptions and concessions
Concessions apply automatically for green cars and primary producer passenger cars.
Exemptions and refunds of duty already paid may be available, including:
- transfers between spouses or domestic partners
- for vehicles used by eligible veterans, primary producers and people with disabilities or injuries.
Exemptions are also available for certain vehicles registered by licensed motor car traders.
Learn more about exemptions and concessions for motor vehicle duty.
Licensed motor car traders (LMCTs)
LMCTs must register vehicles with VicRoads and pay motor vehicle duty unless an exemption applies. Vehicles registered as demonstrators or trading stock are exempt from duty.
If a vehicle is sold as part of a drive-away deal, special rules apply for calculating its dutiable value.
If the main use of a demonstrator vehicle changes, LMCTs must notify us and pay duty within 14 days.
Read information for licensed motor car traders.
Payment options
Buying from a dealer
When you buy a roadworthy vehicle from a dealer, you pay them the duty. They lodge it along with your registration application with VicRoads. Once you have paid the dealer, you have no further responsibility for duty on the transfer or registration.
If you do not pay duty to the dealer, both you and the dealer are responsible for the full amount. We can recover the duty from either of you.
Buying privately
If you buy a registered vehicle privately, you must complete the registration transfer application and pay duty directly to VicRoads within 14 days of the purchase. Penalties apply if you do not lodge your application on time or if you under-declare the vehicle's value.
If the vehicle is unregistered, you pay duty when you lodge the registration application.
Other vehicle transfers
If a vehicle is transferred to you in another way, such as a gift from a parent, and is garaged in Victoria, you must tell VicRoads and pay duty within 14 days of the transfer. A duty exemption only applies in rare circumstances. Visit the VicRoads website for details on other types of transfers.
Assessment notices
You may receive an assessment or reassessment notice from us if:
- you declare a value lower than the market rate for similar vehicles
- you miss the 14-day deadline to lodge the transfer.
The notice will show the extra duty you need to pay. You must pay it by the due date, even if you plan to object. Learn about your payment options for motor vehicle duty.
Objections and refunds
You can only object to a motor vehicle duty reassessment notice. This may happen if we increase the duty you owe after reviewing your vehicle’s value or type. You must lodge an objection with 60 days of the date of your notice and still pay by the due date.
Learn how to object to a motor vehicle duty assessment.
Refunds may be available if you overpay duty. The most common reason is if you paid duty but later qualify for an exemption or concession. Find out how to apply for an exemption, concession or refund.
