Can GST be charged on only 50% of the selling price for certain transactions?
Yes. Under the Discounted Sale Price Scheme, GST may be charged on only 50% of the selling price for qualifying sales of second-hand or used motor vehicles.
What is the Discounted Sale Price Scheme?
The Discounted Sale Price Scheme is a GST concession that allows businesses selling used motor vehicles to account for GST on only 50% of the selling price.
Why is GST charged on only 50% of the selling price?
This is because part of the value of a used motor vehicle relates to the Certificate of Entitlement (“COE”) and Additional Registration Fee (“ARF”), which are not subject to GST.
Is prior approval from IRAS required to use the scheme?
No. Businesses are generally not required to obtain prior approval from IRAS before applying the Discounted Sale Price Scheme.
