Free Vermont Vehicle Bill of Sale
Vermont treats the bill of sale as the cornerstone of every vehicle transfer — even for the surprising number of older cars that move on no title at all. A Vermont-registered 1995 pickup or 2008 hatchback may have no title, so it changes hands with Form VT-005, the seller's Vermont registration certificate, and Form VD-119 — and since July 1, 2024 the buyer is issued a Vermont title at registration. The 6% Purchase and Use Tax is calculated by VT DMV at the counter using the higher of your bill-of-sale price or J.D. Power clean trade-in value, and while Vermont law sets no fixed filing deadline for the buyer (23 V.S.A. §2023), the vehicle cannot be driven on Vermont roads until it is registered. A clean VT-005 with VIN, odometer, price, and signatures keeps the transaction clear when VT DMV compares the price with the J.D. Power value.
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Vermont Vehicle Bill of Sale — What You Need to Know
Sales Tax Details
Vermont charges a 6% Purchase and Use Tax on motor vehicles, collected by the VT DMV at title transfer. Tax is calculated on the higher of sale price or J.D. Power clean trade-in value, so a low number on the bill of sale will not reduce tax owed.
Exemption: A vehicle received as a gift can be exempt from the Purchase and Use Tax — file Form VT-014 (Certification of Tax Exemption) with VD-119, and check the DMV's list of allowable exemptions.
Inspection Requirements
Vermont requires an annual safety inspection at a VT-certified inspection station before registration; the sticker goes on the windshield. The annual inspection also includes an emissions (OBD) check for gas and diesel vehicles 16 model years old or newer with a GVWR of 8,500 pounds or less.
Vermont Vehicle Sale — Step-by-Step Checklist
- Use Form VT-005 (Vermont Bill of Sale) with full VIN, year, make, model, odometer reading, sale price, and date
- Print and sign both buyer and seller names; Vermont does not require notarization for VT-005
- If the vehicle has a title, have the seller complete the assignment on the back of it
- For older vehicles with no title, attach the prior Vermont registration to the bill of sale
- File Form VD-119 with VT DMV before driving on Vermont roads to register, title, and pay 6% Purchase and Use Tax
- Schedule a Vermont annual safety inspection at a certified station before driving past the temporary period
Common Pitfalls
- Writing a low "gift" or "favor" price — VT DMV taxes on J.D. Power clean trade-in value when the bill of sale undercuts it, so you pay 6% either way
- Driving the vehicle on Vermont roads before VT DMV has registered it in your name
- Assuming a no-title vehicle is junk — a Vermont-registered car of model year 2009 or older can legally sell on a bill of sale plus the Vermont registration certificate, and the buyer then gets a title
- Forgetting the annual Vermont inspection sticker; troopers ticket on expired stickers and registration cannot renew without one
Pro Tip
Vermont’s bill-of-sale process is straightforward: no fixed filing deadline in state law, 6% tax on the greater of price or J.D. Power clean trade-in value, and registration plus a current inspection sticker before you drive. Use Form VT-005, file VD-119 promptly, and keep your copies.