what do you pay car sell tax in canada

[VonLayla]

When you sell a car privately in Canada, you generally do not pay sales tax as the seller. The responsibility for paying the tax falls on the buyer. However, there's a crucial exception: if you are registered for GST/HST as a business (like a dealership), you must charge and remit the tax. For most individuals, the main tax event is when you buy a car, not when you sell one.

The buyer is required to pay the applicable sales tax (GST/HST/PST) based on the car's selling price or the wholesale value determined by the province, whichever is higher, when they register the vehicle. The specific rate depends entirely on the province or territory where the vehicle will be registered.

Province/Territory	Tax Type	Total Tax Rate (%)	Notes
Ontario	HST	13%	Harmonized Sales Tax
British Columbia	PST + GST	12% (7% PST + 5% GST)	PST is on the greater of purchase price or wholesale value.
Alberta	GST	5%	No provincial sales tax.
Quebec	QST + GST	14.975% (9.975% QST + 5% GST)
Nova Scotia	HST	15%	Harmonized Sales Tax
New Brunswick	HST	15%	Harmonized Sales Tax
Manitoba	PST + GST	12% (7% PST + 5% GST)
Saskatchewan	PST + GST	11% (6% PST + 5% GST)
Newfoundland & Lab.	HST	15%	Harmonized Sales Tax
Prince Edward Island	HST	15%	Harmonized Sales Tax
Yukon	GST	5%
Northwest Territories	GST	5%
Nunavut	GST	5%

The process is straightforward for a private seller. You just need to provide a signed bill of sale and the vehicle's registration documents. The buyer then takes these to the provincial licensing authority, pays the tax, and completes the transfer. If you sell a car for a profit, that amount could be considered a capital gain, but for occasional sales of personal property, this is rarely an issue. Always ensure the bill of sale clearly states the sale price, the date, and both parties' information to protect yourself.

[LeCharles]

Nope, you don't pay tax when selling your own car. I just went through this in Ontario. I sold my old SUV to a guy from Kijiji. We agreed on a price, I signed over the ownership, and he gave me cash. The tax part was his problem. He had to go to Service Ontario and pay the 13% HST on what he paid me before he could get new plates. My job was just to make sure the bill of sale was filled out correctly so the transfer was clean.

[LeTucker]

The key thing to understand is the distinction between a private sale and a business sale. As an individual, selling your personal vehicle is not a taxable event for you. The tax liability shifts to the purchaser upon registration. Provincial authorities collect the tax at that point based on the documented sale price. If you are a frequent flipper or a dealer, the rules are completely different and you must charge GST/HST. For the average person, it's a tax-free transaction.

[DianaFitz]

Think of it this way: the government taxes the transaction once, when the car changes hands and is registered to a new owner. Since you already paid tax when you first bought the car, they don't double-dip by taxing you again when you sell it. The system is designed so the new owner pays the tax, effectively resetting the clock. So, when you're negotiating a price with a buyer, remember that number is what you get. They have to factor in an extra 5% to 15% on top of that for the taxman.

[McRiley]

From a legal standpoint, the Excise Tax Act governs this. The sale of a used personal-use vehicle by an individual not in the business of selling cars is generally considered an exempt supply. This is the legal reason you don't charge GST/HST. The onus is on the buyer to self-assess the tax, meaning they report and pay it directly to the government during the licensing process. Always keep a detailed bill of sale for your records to prove the agreed-upon value and the nature of the transaction, protecting you from any future disputes.