GST/HST and motor vehicles
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GST/HST and motor vehicles
Notice to reader
The information on this page replaces the information in Guide RC4100, Harmonized Sales Tax and the Provincial Motor Vehicle Tax.
On this page
Find out how the GST/HST applies to a private sale of a specified motor vehicle
Find out how the GST/HST applies to a sale of a specified motor vehicle from a GST/HST registrant
Find out how the GST/HST applies to a lease of a specified motor vehicle
Find out if the GST/HST applies to a gift of a specified motor vehicle
GST/HST available rebate on the purchase of, or a modification service performed to, a qualifying motor vehicle
Summary of how the GST/HST applies to sales of specified motor vehicles
The GST/HST on specified motor vehicles may apply differently to governments and municipalities, indigenous peoples, foreign representatives and diplomatic missions, and customers outside Canada (import and exports).
Find out how the GST/HST applies to a private sale of a specified motor vehicle
When you buy a specified motor vehicle through a private sale (for example, you bought the vehicle from a person who is not a GST/HST registrant), GST/HST does not generally apply to the sale.
However, you may have to pay the provincial motor vehicle tax when you register the vehicle. Your provincial government imposes and administers this tax, which is separate from the GST/HST.
You would not have to pay the provincial motor vehicle tax in some cases, including the following situations:
- You bought your vehicle in a participating province from a GST/HST registrant (for example, a fisher or farmer) who used the vehicle in their commercial activities. The registrant should have collected HST.
- You are moving from one participating province to another participating province, and you have already paid HST on the vehicle.
- You lived in a non-participating province before moving to a participating province, and owned and used your vehicle before the move. This depends on how long you owned the vehicle and whether you paid the provincial sales tax (PST) in a non-participating province. (If you are registering your vehicle in Nova Scotia, you do not have to show proof that you paid PST in a non-participating province.)
- You are returning to Canada after an absence of at least one year, and you owned your vehicle and used it abroad for at least six months.
- You inherited the vehicle.
Contact your provincial vehicle registration office, or local provincial tax administration office, for rules specific to your province.
Find out how the GST/HST applies to a sale of a specified motor vehicle from a GST/HST registrant
Generally, when you buy a specified motor vehicle from a GST/HST registrant (for example, a dealership), the GST/HST applies on the sale. The GST/HST rate to be used generally depends on several criteria such as delivery and date of registration. For more information, see Summary of how the GST/HST applies to sales of specified motor vehicles.
If you trade a used vehicle for full or partial payment, the GST/HST treatment depends on if you have to charge tax on the trade-in. For more information, see Trade-ins.
When and who has to pay the provincial part of the HST
Generally, you have to pay the provincial part of the HST or a part of that part when you register your vehicle in a province where the HST applies if you bring the vehicle into a participating province:
- from another province and you were either not required to pay the provincial part of the HST for the supply of the vehicle or were required to pay it at a lower rate
- from outside Canada and you were not required to pay the provincial part of the HST for the taxable importation of the vehicle
However, you may need to self-assess the amount owing. Generally, if the provincial laws relating to motor vehicle registration do not require you to register the vehicle, you have to self-assess the amount owing if you bring the vehicle into a participating province from:
- a non-participating province
- a participating province with a lower HST rate
- outside Canada
Use Form GST489, Return for Self-assessment of the Provincial Part of Harmonized Sales Tax (HST) to self-assess the provincial part of the HST or the difference between the two HST rates.
Who and when to recover the provincial part of the HST
You can get a rebate of the provincial part of the HST you paid on specified motor vehicles, or a part of that part, if all of the following conditions are met:
- You are a resident of Canada
- You bought the vehicle in a participating province and paid HST on it
- You bought the vehicle for consumption, use, or supply exclusively (generally 90% or more) outside the participating province
- You removed the vehicle from the participating province to another province or other area of Canada that has a lower provincial part of the HST or no HST no later than 30 days after it was delivered to you (any amount of time that the vehicle was in storage is not counted as part of the 30 days)
- If you removed the vehicle to a non-participating province or other area of Canada, you paid the applicable provincial sales tax of the non-participating province or other area of Canada and any other applicable taxes
To apply for the rebate, use Form GST495, Rebate Application for Provincial Part of Harmonized Sales Tax (HST).
What documents are required to support your claim?
To support your rebate claim for specified motor vehicles, attach all the following:
- copies of receipts for each purchase (do not send original receipts)
- proof of payment of applicable provincial taxes
- copies of receipts to substantiate the date of storage, if the vehicle was in storage (do not send original receipts)
Find out how the GST/HST applies to a lease of a specified motor vehicle
Generally, when you lease a specified motor vehicle from a business (that is a GST/HST registrant), you are required to pay the GST/HST on your lease payments.
If you trade a used vehicle for full or partial payment for a lease, the GST/HST treatment depends on if you have to charge tax on the trade-in. For more information, see Trade-ins.
| If you lease a specified motor vehicle for | Then |
|---|---|
| A continuous period of 3 months or less | GST/HST is applicable on lease payments at the rate of the province in which the supplier delivers the vehicle or makes it available to the customer. |
| A continuous period of more than 3 months | GST/HST is applicable on lease payments at the rate of the province in which the vehicle is required to be registered under the laws of that province. |
Find out if the GST/HST applies to a gift of a specified motor vehicle
A used specified motor vehicle supplied by way of a gift between two related individuals is generally not subject to the GST.
GST/HST available rebate on the purchase of, or a modification service performed to, a qualifying motor vehicle
You may be eligible to claim a specially-equipped motor vehicle rebate if you paid GST/HST on the purchase of a qualifying motor vehicle, or you paid GST/HST on a modification service performed on your motor vehicle.
To apply for the rebate, use Form GST518, GST/HST Specially Equipped Motor Vehicle Rebate Application. For more information, see Excise and GST/HST News – No. 83 (Winter 2012).
Summary of how the GST/HST applies to sales of specified motor vehicles
The following tables provide a summary of the application of the GST/HST in various circumstances on a sale made by a GST/HST registrant.
| Place where vehicle is delivered or made available |
Vehicle registrationFootnote 2 | Tax payable on delivery |
|---|---|---|
| Participating province or non-participating province |
Non-participating province | GST and the provincial motor vehicle tax |
| Participating province | Participating province | HST applies at the rate of the province where the vehicle is registered |
| Non-participating province | Participating province | GST |
| Place of supplyFootnote 1 | Vehicle registrationFootnote 2 | Tax payable on delivery | Tax payable on registration | Rebate eligibility (Form GST495) |
|---|---|---|---|---|
| Participating province | Non-participating province | HST | Not applicable | Provincial part of the HST |
| Participating province | Participating province with a lower HST rate | HST at the rate of the province where the supply was made | Not applicable | The difference between the two HST rates |
| Participating province | Participating province with a higher HST rate | HST at the rate of the province where the supply was made | The difference between the two HST rates | None |
| Non-participating province | Non-participating province | GST | Provincial motor vehicle tax | None |
| Non-participating province | Participating province | GST | Provincial part of the HST | None |
Footnotes
- Footnote 1
-
Place of supply
Generally, the supply of a specified motor vehicle by way of sale is made in a province if the supplier does one of the following:- delivers the vehicle in that province to the recipient of the vehicle
- makes the vehicle available in that province to the recipient of the vehicle
Also, a vehicle is deemed to be delivered in a province if the supplier ships the vehicle to a destination in the province specified in the contract for carriage of the vehicle, or transfers possession of the vehicle to a common carrier or consignee that the supplier has retained on behalf of the recipient to ship the vehicle to the province.
- Footnote 2
-
Vehicle registration
Generally, the supply would be considered to be made in a particular province if both of the following applies:- the vehicle is registered (other than on a temporary basis) by or on behalf of the recipient under the laws of the particular province relating to the registration of motor vehicles within 7 days after the day on which the vehicle is delivered or made available to the recipient
- the supplier maintains evidence satisfactory of that registration
What documentary evidence does the supplier need to maintain?
A supplier must maintain the following documentary evidence in its records:
- a dated copy of the permanent registration of the vehicle in the province in the recipient's name
- a copy of the vehicle purchase agreement, or other sales document such as a bill of sale, that indicates the date of delivery of the vehicle
- Date modified:
- 2019-04-15