• A Virginia aircraft registration cannot be issued unless the aircraft is properly insured.
• Options for proving that an aircraft is unsured include
  • provide information evidencing an insurance policy on each individual aircraft that meets the Code requirements for liability
    • $50,000 – because of bodily injury to or death to one person in any one accident
    • $100,000 – because of bodily injury to or death to two or more persons in any one accident
    • $25,000 – because of injury to or destruction of property of others in any one accident
  • provide information evidencing a single limit policy in the sum of $250,000 covering bodily injury and property damage liability in any one accident, including liability of $50,000 per passenger seat
  • provide a bond by a surety company authorized to transact business in Virginia conditioned for payment in amounts and under the same circumstances as would be required in a policy of bodily injury liability and property damage liability insurance as previously described above
  • provide $250,000 in cash or a letter of credit in the amount of $250,000 from a depository institution, whereupon such money or securities delivered to DOAV will be placed in the custody of the state treasurer and will be subject to execution to satisfy any judgement within the limits on amounts required by the Code of Virginia for personal injury and property damage liability insurance
• For aircraft defined by the Federal Aviation Administration as “ultralight’, the proof of financial responsibility required may be satisfied by the issuance to that aircraft of a single limit insurance policy in the sum of $100,000 covering bodily injury and property damage liability in one accident that is issued by an insurance company licensed to write such insurance in Virginia

• DOAV will issue registration decals for each aircraft to be displayed as required in the Virginia Administrative Code 24VAC5-20-50.
  • The decal must be displayed centered below the right-hand stabilizer on the fuselage or immediately aft of the cabin entry door.
  • Decals for antique aircraft and balloons may be carried with aircraft’s papers in the aircraft.

Aircraft operated by agricultural applicators, including those owned by nonresidents of Virginia, used to apply agricultural chemicals and pesticides are required to have a commercial aircraft registration. Such operators should contact the Virginia Department of Agriculture and Consumer Services for specific information related to agricultural spraying at 804-786-3798.

• An aircraft registration cannot be transferred to a new owner when the aircraft is sold. The seller is required to notify DOAV in writing when the sale occurs, as well as furnish DOAV with the contact information of the new owner.
• Under state law, the Virginia Aircraft Sales and Use Tax does not apply when the ownership of an aircraft is transferred from an individual or partnership when such transfer is incidental to the formation, organization, or dissolution of a corporation in which the individual or partnership has the majority interest.

• Aircraft registration is required when the aircraft becomes capable of flight, whether the aircraft does not currently meet the applicable FAA airworthiness requirements.
• The Virginia Aircraft Sales and Use Tax applies uniformly to operable and inoperable aircraft.
• In the case of inoperable aircraft, the time for payment of such tax is postponed until the aircraft is required to be registered.
• Documentation showing evidence of an aircraft’s condition may be requested by DOAV.

• It is a Class 1 misdemeanor to operate an aircraft that is not registered in Virginia.
• It is unlawful for any individual or business to lease or rent an unregistered aircraft to any person.

• A Virginia aircraft registration cannot be issued unless the Virginia Aircraft Sales and Use Tax has been paid to the Virginia Department of Taxation or proof a similar tax was paid to another state is provided.
• Code of Virginia §58.1 states that the Virginia Aircraft Sales and Use Tax is levied on the sale of every aircraft sold in Virginia and upon the use in the Virginia of any aircraft required to be registered by the DOAV.
• The Virginia Aircraft Sales and Use Tax is based on the sale price of the aircraft at the time it was purchased. “Sale price” means the total price paid for an aircraft including all attachments and accessories, exclusive of any federal manufacturer’s excise tax, without any allowance for trade-ins. Unlike personal property tax, which is based on the current value of the property, the Virginia Aircraft Sales and Use Tax is ultimately based on the paid price of the aircraft, regardless of whether it is later damaged and loses value.
• The Virginia Aircraft Sales and Use Tax also applies to aircraft kits, parts, and accessories when the aircraft becomes airworthy and is required to be registered.

The aircraft “owner”, whether an individual or business, is responsible for the Virginia Aircraft Sales and Use Tax.

• The Virginia Aircraft Sales and Use Tax is calculated on the sale price of the aircraft or on the current market value of aircraft if brought into Virginia 6 months or more after acquisition and provided the aircraft is required to be registered with DOAV.
• No credit is allowed for trade-ins. In the absence of a bill of sale or other written evidence of purchase price, the Commonwealth uses an average retail price to estimate the taxable amount of the aircraft.

• DOAV uses the Price Digest’s Aircraft Bluebook Historical Value Reference to determine an aircraft’s value. For aircraft not listed (i.e. kits, assembled from parts, experimental), DOAV determines the average retail price based on the average price of similar aircraft being offered for sale.
• The average retail price used for calculating the tax is the sale amount from the year it was first required to be registered by the new owner.
• A bill of sale with a nominal value such as “$1 and other valuable consideration” will not be considered adequate documentation of the purchase price.

• An aircraft owner must provide documentation showing payment of the Virginia Aircraft Sales and Use Tax. A copy of any one of the following is sufficient:
  • Virginia Aircraft Sales and Use Tax Return (AST-3) copy
  • tax payment check copy
  • copy of the Certificate of Payment of Tax issued by the Virginia Department of Taxation
• If a similar tax was paid to another state, the aircraft owner needs to provide documentation showing such payment, and consideration for a credit towards the Virginia Aircraft Sales and Use Tax will be given. If required, an affidavit shall be furnished stating that such tax has been paid and not refunded.
  • Credit will not be given for state retail sales tax paid on kits or component parts used in the construction of an aircraft.
  • Credit will not be given for an aircraft acquired in another state and taxed on gross receipts from use in another state.

An aircraft owner must provide documentation showing the purchase price paid and/or supporting documentation on the method used to determine the aircraft’s fair market value. Examples of this documentation may include:

• bill of sale copy that includes the actual price paid an aircraft
• closing statement copy
• purchase invoice copy
• sales agreement copy
• bluebook value copy
• appraisal copy

Code of Virginia §58.1-1505 allows an exemption from paying the Virginia Aircraft Sales and Use Tax on any aircraft sold or used by:

1. United States or federal agency
2. Commonwealth of Virginia or state agency
3. any air carrier operating in intrastate, interstate, or foreign commerce providing “scheduled air service” (Part 121) as defined in Code of Virginia §58.1-1501
4. any nonprofit charitable organization which is exempt from taxation under §501(c)(3) of the Internal Revenue Code and which is organized and operating exclusively for the purpose of providing charitable, long distance, advanced life support, air transportation services using an emergency medical services vehicle for low-income medical patients in Virginia
5. an organization that is exempt from taxation under §501(c)(3) of the Internal Revenue Code which is organized for the primary purpose of distributing food, clothing, medicines, and other necessities of life to, and providing shelter for, needy persons in the United States and throughout the world
6. an individual  or organization operating aircraft considered as Warbirds, identified as aircraft manufactured and intended for military use, excluding those manufactured after 1954, and used only for exhibit or display to the general public and otherwise used for educational purposes (including such flights as are necessary for testing, maintaining, or preparing such aircraft for safe operation) or for air show and flight demonstrations (including such flights necessary for testing, maintaining, or preparing such aircraft for safe operation), but not including any aircraft used for commercial purposes, including transportation and other services for a fee
7. an individual or organization operating aircraft that is purchased in Virginia but registered outside of Virginia and removed from Virginia within 60 days of purchase

• When an individual or business fails to file a return or pay the full amount of sales and use tax required by the Code of Virginia within the 30 days required for filing and payment, a penalty in the amount of 6 percent is added to the Virginia Aircraft Sales and Use Tax. An additional 6 percent of the tax is charged for each additional 30-day period. The additional penalty will not exceed 30 percent.
• Interest is determined at a rate in accordance with the Code of Virginia §58.1-15 and applies to the unpaid amount of the tax from the day after the due date for timely filing. Interest on the payment of the tax will accrue until the tax is paid.

Because the Virginia Aircraft Sales and Use Tax is on the purchase of property, not on the possession of property, the Virginia Aircraft Sales and Use Tax is due on the sales price when you purchased the aircraft that was required to be registered with DOAV, regardless of whether you still own the aircraft.

No aircraft shall be required to be registered if the aircraft is brought into Virginia solely for major maintenance or major repair. An aircraft owner shall provide all the following to DOAV:

• • proof the aircraft is based at an airport in another state, shown by evidence of a hangar or tie-down lease for a minimum of 12 months prior to the aircraft being brought to Virginia
  • proof the work is performed in Virginia, shown by presentation of invoices that describe the work specific to the aircraft

• All aircraft registration forms are available in the Forms and Publications section.
• The Aircraft Sales and Use Tax Return can be downloaded from www.tax.virginia.gov.

• For assistance related to tax, contact the Virginia Department of Tax at 804-786-2450 or www.tax.virginia.gov.
• For assistance related to aircraft registration, contact DOAV at 804-774-4655 or aclicensing@doav.virginia.gov.