North Dakota Vehicle Sales Tax & Fees

North Dakota Car Sales Tax

It’s exciting to buy a new (or new for you) car, but it’s also far from cheap.

Things like sales tax and other fees are often forgotten about in the excitement of making a new car purchase. But in North Dakota, you’ll need to be prepared to spend additional money on these extra costs.

Here’s what to expect when it comes to taxes and fees in the state of North Dakota.

How Much Is the Car Sales Tax in North Dakota?

How Much Is North Dakota Sales TaxThe state sales tax on a car purchase in North Dakota is 5%.

However, this does not include any potential local or county taxes. The average local tax rate in North Dakota is 0.959%, which brings the total average rate to 5.959%.

As an example, if you were to purchase a new sedan at a purchase price of $20,000, then you will have to pay an additional $1,000 in tax.

How to Calculate North Dakota Sales Tax on a Car

You can calculate the sales tax in North Dakota by multiplying the final purchase price by .05%.

For example, let’s say that you want to purchase a new car for $30,000, you would use the following formula to calculate the sales tax:

$30,000 x.05 = $1,500

This means that your sales tax is $1,500 on a $30,000 purchase price.

Calculate Car Sales Tax in North Dakota Example:

  • Initial Car Price: $30,000
  • Sales Tax Rate: 5%
  • Trade-In Amount: $5,000
  • Incentives/Rebates: $2,000

Sales Tax = ($30,000 - $5,000) * .05
Sales Tax = $1,250

Remember that the total amount you pay for a car (out the door price) not only includes sales tax, but also registration, and dealership fees.

Do I Have to Pay Sales Tax on a Used Car?

The sales tax is the same 5% on a used vehicle.

For example, if you were to purchase a used car for $15,000, then you will have to pay an additional $750 in sales tax.

North Dakota Highest and Lowest TaxWhich County Has the Highest Tax? Which Has the Lowest?

The North Dakota county with the highest tax is Williams at 8.5%.

The North Dakota counties with the lowest tax are Adams, Bowman, and Slope counties with a rate of 5%.

Car Sales Tax for Trade-Ins in North Dakota

Trade Ins North DakotaYou don’t have to pay sales tax on trade-ins in North Dakota. In other words, be sure to subtract the trade-in amount from the car price before calculating sales tax.

As an example, let’s say you are purchasing a new SUV for $25,000 and your trade-in is worth $5,000. You will subtract the trade-in value by the purchase price and get $20,000. Therefore, your car sales tax will be based on the $20,000 amount.

Car Sales Tax on Private Sales in North Dakota

A sales tax is required on all private vehicle sales in North Dakota.

As an example, if you purchase a truck from a private party for $10,000, then you will pay 5% of that amount to the North Dakota DMV.

Tax on Rebates & Dealer Incentives

Rebates North Dakota TaxYou do have to pay tax on dealer rebates and incentives in North Dakota. In other words, do not subtract the incentive/rebate amount from the car price before calculating sales tax.

As an example, if you are purchasing a new car for $30,000 with a $5,000 rebate, you will pay sales tax on the $30,000 final cost of the car.

North Dakota DMV/State Fees

There are some other state and DMV fees associated with the purchase of a vehicle in North Dakota.

A few of these fees include:

  • Registration Fee: $49 to $274
  • Title Fee: $5
  • Plate Transfer Fee: $5

North Dakota Dealership Fees

Dealerships apply extra fees, sometimes referred to as “doc fees,” with the sale of the car.

Though these fees vary based on the dealership, the average fee in North Dakota is $175, with no statewide limit on how much dealerships can charge.

When Sales Tax Is Exempt in North Dakota

North Dakota Tax Exemptions

The following events are exempt from car sales tax in North Dakota:

  • You receive the vehicle as a gift from a spouse, parent, child, grandparent, or grandchild.
  • The vehicle was received as part of an inheritance.
  • You receive the vehicle in a divorce.
  • You receive the vehicle from an individual’s revocable trust.

North Dakota EV Rebates & Incentives

North Dakota does not offer a rebate on EVs or hybrid vehicles. However, all North Dakota residents are eligible for a federal EV rebate of up to $7,500.

 

Tax information and rates are subject to change, please be sure to verify with your local DMV. 

Frequently Asked Questions

What is the sales tax on a car purchased in North Dakota?

The sales tax on a car purchased in North Dakota is 5%. However, this does not include any potential local or county taxes. The average local tax rate in North Dakota is 0.959%, which brings the total average rate to 5.959%.

Do I have to pay sales tax on a used car in North Dakota?

The sales tax on a used vehicle is 5% in North Dakota. For example, if you are purchasing a used SUV for $40,000, then you will pay an additional $2,000 in car sales tax.

Which county in North Dakota has the lowest tax?

The North Dakota counties with the lowest tax are Adams, Bowman, and Slope counties with a rate of 5%.

Which county in North Dakota has the highest tax?

The North Dakota county with the highest tax is Williams at 8.5%.

Do I have to pay sales tax on a gifted car in North Dakota?

You do not have to pay sales tax if your vehicle was gifted by an immediate family member.

How much is registration in North Dakota?

The North Dakota DMV charges the following fees:

  • Car Registration Fee: $49 to $274 per year
  • Title Fee: $5

Does a trade-in reduce sales tax in North Dakota?

You can reduce your sales tax with a trade-in.  As an example, if you purchase a new SUV with the price of $50,000 and your trade-in is worth $10,000, then your sales tax will be based on the $40,000 amount.

How can I avoid paying sales tax in North Dakota?

You can avoid sales tax on a vehicle sale in North Dakota in the following circumstances:

  • You inherited the vehicle.
  • You receive the vehicle as a gift from a spouse, parent, child, grandparent, or grandchild.
  • You receive the vehicle from an individual’s revocable trust.