Highway Use Tax
North Carolina collects a Highway Use Tax (HUT) on vehicles instead of a state sales tax. The
tax is assessed each time a title is transferred.
Money that is collected for the Highway Use Tax goes to the NC Highway Trust Fund and the
State's General Fund. That money is then used to improve the roads of North Carolina.
The N.C. Division of Motor Vehicles accepts
and American Express, Visa, MasterCard and Discover credit and debit cards at all NCDMV office locations.
|Tax, Commercial Vehicles 26,001 lbs and over [?]
|Tax, Mobile Homes (Collected by Selling Dealers) [?]
||2% Sales Tax, Max $300
|Tax, Out-of-State Residents [?]
|Tax, Special Mobile Equipment [?]
||7% Sales Tax CHECK. RALEIGH WINDOW. DONE BY COUNTY
|Tax, Vehicles [?]
||3% Highway Use Tax
Exemptions from Highway Use Tax
Vehicles already titled within North Carolina have certain exemptions from the
HUT such as:
- An insurance company obtaining a salvage title for a vehicle on which a total loss claim was paid.
- When transferring a title to a manufacturer or retailer for the purpose of resale.
- When making a name change or name correction to a title.
- If the vehicle is transferred by a will or intestacy.
- If the vehicle is a gift between a husband and wife, a parent and child or a stepparent and a
stepchild. This exemption does not include out-of-state title transactions, only NC title
- If the vehicle is transferred as a result of the distribution of marital or divisible property incident to a marital separation or divorce.
- To a handicapped person from the Department of Health and Human Services after the vehicle has
been equipped by the Department for use by the handicapped.
- To a local board of education for use in the driver education program of a public school when the vehicle is transferred by a retailer and is to be transferred back to the retailer within 300 days after the transfer or transferred by a local board of education.
- To a volunteer fire department or volunteer rescue squad that is not part of a unit of local
government, has no more than two paid employees, and is exempt from NC Income Tax under
G.S. 105-130.11, when the motor vehicle is one of the following:
- A fire truck, a pump truck, a tanker truck, or a ladder truck used to suppress fire.
- A four-wheel drive vehicle intended to be mounted with a water tank and hose and used for forest fire fighting.
- An emergency services vehicle.
Registration Stop: County Tax Block
If you fail to pay county taxes on your vehicle you must contact your County Tax Department to clear the stop.
State property tax law requires counties to assess the value of motor vehicles registered with DMV and to prepare tax bills. Three months after the motor vehicle's registration renewal date, the vehicle owner will receive a tax bill which is payable on the first day of the following month.
The property tax law calls for counties to charge interest for overdue accounts. Legislation now allows counties to block the license plate (registration) renewal for any vehicle for which the owner owes an overdue property tax.
The DMV is not involved in establishing the value of a vehicle for property tax purposes. It furnishes a record of the make and model of the registered vehicle, and the local county assessment office determines the tax accordingly.
Vehicles Not Included Under North Carolina Property Tax Law
Vehicles exempt from registration by North Carolina law.
- Manufactured homes
- Mobile classrooms and offices
- Semi-trailers registered on a multi-year basiss
- Motor vehicles owned or leased by public service companies
- Vehicles in confidential statuss
- Vehicles registered under the International Registration Plan
- Vehicles issued permanent registration plates
- Farm vehicles issued a three-month registration plates
- Park models
North Carolina residents who have not registered their vehicles or who have not renewed their vehicle registrations are required to list their vehicles with their county of residence by Jan. 31 of each year.
Property Tax & Limited Registration Plates (G.S. 20-79.1A)
Vehicle property tax is due when updating or renewing a plate. Interest will be charged on late vehicle property tax payments and on late registration renewals.
Drivers have the option of purchasing a new license plate or obtaining a limited registration plate. Vehicle property tax is due when a new plate is purchased. A limited registration plate allows the vehicle property taxes to be deferred for 60 days.
A limited registration plate will have a temporary (T) year sticker that will expire in 60 days, if the vehicle's property taxes are not paid in full. Payment of vehicle property taxes for a limited registration plate must be made to the DMV to validate the year sticker for the remainder of the year.