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, which has been discontinued.


GST/HST on the 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), the GST/HST does not generally apply to the private sale.

However, you may have to pay the provincial motor vehicle tax when you register the vehicle. Your provincial government charges and administers this tax, which is separate from the GST/HST.

You do 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.

GST/HST on the sale of a specified motor vehicle by 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 the place of delivery and date of registration. For more information, see GST/HST on 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 GST/HST in special cases – Trade-ins.

Who has to pay the provincial part of the HST and when

Generally, you have to pay the provincial part of the HST or a portion of it when you register your vehicle in a province where the HST applies or if you bring the vehicle into a participating province from:

  • another province or other area in Canada and you were not required to pay the provincial part of the HST for the supply of the vehicle or you were required to pay it at a lower rate
  • outside Canada and you were not required to pay the provincial part of the HST on the 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.

How 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 portion of that part, if you meet all of the following conditions:

  • 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 brought 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 brought the vehicle from the participating province to a non-participating province or other area of Canada, you paid the provincial sales tax of the non-participating province or other area of Canada as well as any other taxes that apply

To apply for the rebate, use Form GST495, Rebate Application for Provincial Part of Harmonized Sales Tax (HST).

GST/HST on the lease of a specified motor vehicle

Generally, when you lease a specified motor vehicle from a business that is a GST/HST registrant, you have 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 GST/HST in special cases – Trade-ins.

GST/HST on leases
Lease period (must be continuous) GST/HST application
Three months or less GST/HST applies on lease payments at the rate of the province or other area in Canada where the supplier delivers the vehicle or makes it available to the customer.
More than three months GST/HST applies on lease payments at the rate of the province or other area in Canada where the vehicle must be registered under the laws of that province.

GST/HST on  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/HST.

GST/HST rebate on the purchase of or modification 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).

GST/HST on sales of specified motor vehicles

The following tables show how the GST/HST is applies in various circumstances on a sale made by a GST/HST registrant.

Tax payable when the vehicule is registered within seven days of the delivery date
Where the vehicle is
delivered or made available
Where the vehicle is registeredFootnote 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 at the rate of the province where the vehicle is registered
Non-participating province Participating province GST
Tax payable when the vehicle is registered more than seven days after the delivery date
Place of supplyFootnote 1 Where the vehicle is registeredFootnote 2 Tax payable on delivery Tax payable on registration Eligible rebate (Form GST495)
Participating province Non-participating province HST None 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 None 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
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