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Know the Elements And Significance of a Bill of Sale Form

Scholasticus K Jul 7, 2019
Any legal transaction involving transfer of ownership or sale of a vehicle or good requires a bill of sale form. It is primarily used for selling used vehicles. Here is the details and requirements of the bill. Read on...
The sale of any object as a good or service is a transaction, a contract, and even an agreement. To govern the transaction, every state has passed two important enactments. The first one is the sale of goods law, and the other is the contract act. These two acts are fundamental to all transactions, contracts, and agreements, where sales take place.
These forms can be divided into two types, namely, the person to person sale form and the seller to person sale form. If a person sells his car/used car to his/her friend, then the sale form is a person to person one. On the other hand, if a trader sells a used car, it will be signified as seller to person bill.
Both bills are equally important, having same elements and contents. The person to person bill will be stamped by a notary and signed by a witness. The seller to person bill would have, along with things in the person to person bill, the letter head, an intimation that the person is authorized to sell it, and it is his profession to sell the good or service.

Elements of a Sale Form

An automobile bill or a sale form for normal goods is a document signifying a conclusive evidence implying the transfer of property from any person or entity to another one. Here are some elements that should be present by default in the sale form.
✦ Parties: A standard bill of sale has two parties needed for the transaction, that is the seller and the buyer.
✦ Consideration: This includes the cash or money paid by mediums like credit cards, demand drafts, checks, etc. A consideration might also be just credit, that is an unpaid amount of money to be paid off at a specified or unspecified future date.
✦Transaction Date: This date is signified to point out the ownership transfer, lien or the right to ownership of the object of sale. After or on that day, the right passes to the buyer.
✦ Payment: There are details of payment to be included, like details of the payee, payer, buyer or seller. The mode, amount, date, taxes, etc., are also in the bill.
✦ Custody: The last element of the bill is the custody of the goods. In some cases, though the ownership of goods is transferred immediately, the custody is not.

Significance of a Sale Form

It is a conclusive evidence to the fact that the sale actually took place. Thus, the document can be used as proof of ownership, or it can be used as a proof of income received through the sale, or in contrast, a proof of expenditure.
This makes the transaction legally recognizable and transparent. If you look at an example of bill of sale, you will see that the tax and insurance are explicitly mentioned. The document signifies the implication of the sale.
That is, in a bill of sale for a car, the fact that the new owner has to pay the premium of the insurance and the requisite taxes are mentioned. Thus, depending upon the situation, the small details have to be covered in a bill of sale.
It is an important document and it is necessary to signify all the related details and elements on the bill. Apart from that, as per the state you live in, you may have to fulfill compliance in the sale form.