Personal Property Tax Relief
What is Personal Property Tax Relief or PPTRA?
The State of Virginia has allocated funds to provide tax relief for qualifying vehicles in the County of Henrico. The amount of tax relief is based upon the total dollars from the Commonwealth divided by the total tax of all qualifying vehicles in the County. The 2005 General Assembly capped the total cost of tax relief for the Commonwealth of Virginia at $950 million. It is possible that the portion of the total personal property tax on your vehicle that you have to pay may increase as the number of qualified vehicles in Henrico County increases. The tax rate shall be applied in full to that portion of the value in excess of $20,000 for each qualifying vehicle.
What is the current rate of PPTRA reimbursement in Henrico?
Owners of qualified vehicles assessed at $1,000 or less will receive 100% tax relief on that vehicle.
If the qualified vehicle is assessed at more than $1,000, tax relief will be given at a rate of 55% (up to a maximum of $20,000 in assessed value) for 2014.
What is a qualifying vehicle?
Any passenger car, motorcycle, pickup or panel truck having a registered gross weight of less than 7,501 pounds. Furthermore, the vehicle must be owned or leased by an individual and NOT used for more than 50% business purposes. A leased vehicle for personal (non-business) use will also qualify when the lessee is responsible for payment of the personal property tax by the terms of the lease agreement.
What is a non-qualifying vehicle?
A vehicle used predominantly for business purposes. This includes a vehicle leased by an individual and the leasing company pays the tax without reimbursement from the individual. Likewise, a pickup or panel truck having a registered gross weight of 7,501 pounds or greater does not qualify.
What is the definition of business purpose?
If your vehicle meets any of the following criteria, then your vehicle is considered predominantly used for business purposes and does not qualify for Personal Property Tax Relief. Therefore, the taxpayer would be responsible for full payment of the tax:
- More than 50% of the mileage for the year is claimed as a business expense for Federal Income Tax purposes OR is reimbursed by an employer.
- More than 50% of the depreciation associated with the vehicle is deducted as a business expense for Federal Income Tax.
- The cost of the vehicle is expensed pursuant to Section 179 of the Internal Revenue Service Code.
- The vehicle is leased by an individual and the leasing company pays the tax without reimbursement from the individual.
Where can I obtain a Personal Property tax return for my vehicle?
Returns may be obtained from our office located in Room 135 of the County Administration Building at 4301 East Parham Road and at the Eastern Government Center at 3820 Nine Mile Road, or by calling (804) 501-4263.