Consignment sales

What is a consignment sale?

A consignment sale is when the actual owner of a vehicle (the consignor) enters into a written agreement with a dealer (consignee) to sell a vehicle and to act as an agent for the vehicle owner.

Conditions of consignment sale

  • When a dealer acts as an agent for a vehicle owner, several conditions must be present.
  • The transaction was made in the name of and for the owner of the vehicle.
  • The vehicle owner's name, the model and description of the vehicle, and the buyer's name.
  • The actual amount received for the sale, the amount of commission received, and any other incidental income received by the dealer for the transaction.

Tax due

When an unregistered person consigns a vehicle to a dealer for sale, the dealer will collect the retail sales tax. The dealer will remit the retail sales tax on its excise tax return. Under the Retailing B&O tax classification, the dealer will take a deduction for the amount of the consignment sale on the deduction detail sheet. The dealer will pay the Service and Other Activities B&O tax on the amount received as commission and any other fees for the sale.

When a registered dealer consigns vehicles to another dealer for sale, the consignee (selling dealer) must report their commission and any other fees under the Service and Other Activities B&O tax classification. However, the retail sales tax should be turned over to the consignor to be reported on its excise tax return. The consignor owes the Retailing B&O tax and must remit the retail sales tax on the full selling price.

Dealer selling in own name

When the dealer sells a vehicle received from an unregistered person in its own name, the sales are retail sales and the dealer must pay the Retailing B&O tax and collect the retail sales tax.

Sales in the dealer's name of vehicles from other dealers are also considered retail sales, subject to the Retailing B&O tax and the retail sales tax. The consigning dealer, in this case, is making a wholesale sale to the selling dealer and must report under the Wholesaling B&O tax classification.


John Jones consigns his vehicle to Dealer A located in Olympia, Washington. Mr. Jones says he does not want the car sold for less than $3,000. A contract is drawn up showing that John Jones has consigned this particular vehicle, make and model, color, special markings and equipment, to Dealer A for sale for no less than $3,000. Dealer A will try to sell the car for one month. If Dealer A sells the car, he will receive a 10% commission plus a fee of $50.

Dealer A sells the car for $4,000. Dealer A is required to collect the retail sales tax on $4,000 at the Olympia rate of 8.0% or $320. Dealer A takes his 10% commission, $400, plus his fee of $50 and gives the remaining $3,550 to John Jones who owes no taxes.

Dealer A completes its excise tax return in the following manner: $450 under Service and Other Activities, $4,000 under Retailing with a deduction of $4,000 described as consignment sale, $4,000 under state sales tax and $4,000 under the local sales tax coded to location code 3403. Dealer A must remit $328.23 to the Department of Revenue for this transaction: $8.23 Service B&O; $260 state sales tax; and $60 local sales tax.


For a discussion of trade-ins relating to consignment sales, see Trade-ins.


Revised Code of Washington (RCW) 82.08.040
Washington Administrative Code (WAC) 458-20-159
Washington Administrative Code (WAC) 458-20-221