Can Buying a Used Car Be Tax Deductible?

[LaSienna]

The deductibility of VAT on used car transactions depends on the circumstances. Whether a VAT general taxpayer can deduct input VAT when purchasing a used car (transport vehicle) falls into two scenarios: 1. If the enterprise purchases a used car and obtains a special VAT invoice, it can deduct the input VAT based on the invoice: this means the seller purchased the car after January 1, 2009, and had already deducted the input VAT at the time of purchase, so they must issue a special VAT invoice when selling, calculating the output VAT at a 17% rate. 2. If the enterprise purchases a used car and obtains a regular invoice, it cannot deduct the input VAT: this is because the seller purchased the car before January 1, 2009, and had not deducted the input VAT at that time, so the sale is calculated using a simplified method with the formula (tax-inclusive price/1.03*2%) to determine the payable VAT. Additional information: If an enterprise purchases a used car from a VAT small-scale taxpayer, there is no issue of deduction, as small-scale taxpayers use the simplified method (tax-inclusive price/1.03*2%) to calculate the payable VAT and issue regular invoices to the buyer.