Chapter 10-5 MA D.O.R. Directive Sales and Use Tax ISSUE 1: PURCHASE OF VEHICLE BY MASSACHUSETTS RESIDENT FROM A MASSACHUSETTS DEALER What procedure must a purchaser follow in order to pay the sales tax due on a motor vehicle purchased from a Massachusetts car dealer? DISCUSSION: Under Massachusetts law, the purchaser of a motor vehicle is directly responsible for the payment of the sales tax. Purchasers who make arrangements to have a third party pay over the tax on their behalf are still responsible for its payment and are cautioned to make sure the tax has been paid. The payment must be remitted to the Registry of Motor Vehicles and is a prerequisite to the vehicle's registration. The payment may be made in cash or by bank, certified, cashier's, personal or business check payable to the Commonwealth of Massachusetts. These statutory requirements differ from those generally applicable to retail sales, under which the vendor is required to collect the sales tax from the purchaser and remit it to the Department of Revenue. Since a motor vehicle must at the latest be registered within ten days of purchase, payment of the sales tax must also be made within that time. If for any reason a vehicle is not registered, the owner must apply for a title and payment of the tax must be made within ten days of purchase. If payment is not made on or before the twentieth day of the month following the month in which the vehicle was purchased, the purchaser shall become liable for interest and penalties under the sales tax law. DIRECTIVE: The purchaser of a motor vehicle is directly responsible for payment of the sales tax. Payment must be made at the time the vehicle is registered or by the twentieth day of the month following the one in which the vehicle was purchased, whichever is earlier. 10:67