Buying a used car in British Columbia involves navigating the provinces dual sales tax system. Unlike some provinces where used car purchases have different rates, BC applies the same 12% combined GST and PST to used vehicles as it does to new ones. Understanding when and how this tax is collected is key to avoiding surprises at the dealership or when registering at ICBC.
BC Used Car Tax Rate — 2026
British Columbia charges the following taxes on used car purchases:
- Federal GST: 5% on all vehicle purchases
- Provincial PST: 7% on all vehicle purchases
- Total combined rate: 12%
The only significant difference between new and used car purchases in BC is that new EVs under $75,000 MSRP are PST-exempt, while used EVs generally still attract the full 7% PST.
Dealer Sale vs Private Sale — Key Differences
The biggest difference between buying a used car from a dealer versus privately in BC is when and how the tax is collected:
Buying from a Licensed Dealer
- Dealer collects GST and PST at the time of sale
- Tax is included in the advertised or negotiated price
- Dealer handles all ICBC registration paperwork
- You receive the vehicle with plates and registration already transferred
Buying from a Private Seller
- Seller does not collect any tax at the time of sale
- You must pay GST and PST when registering at ICBC
- Tax is calculated on the purchase price or the vehicles actual cash value (ACV), whichever is higher
- Bring your bill of sale to the ICBC licensing office
- ICBC may assess the vehicles value if the sale price seems unusually low
Used Car Tax Examples — BC 2026
BC Used Car Tax Examples — 2026
| Vehicle | Price | GST 5% | PST 7% | Total Tax | Total Cost |
|---|---|---|---|---|---|
| Economy Hatchback | $15,000 | $750 | $1,050 | $1,800 | $16,800 |
| Compact SUV | $28,000 | $1,400 | $1,960 | $3,360 | $31,360 |
| Midsize Sedan | $35,000 | $1,750 | $2,450 | $4,200 | $39,200 |
| Luxury Sedan | $55,000 | $2,750 | $3,850 | $6,600 | $61,600 |
| Premium SUV | $75,000 | $3,750 | $5,250 | $9,000 | $84,000 |
Private Sale — ICBC Assessment Value
When registering a used car purchased privately, ICBC calculates the tax based on the higher of:
- The actual purchase price shown on your bill of sale, or
- The vehicles Current Market Value (CMV) as assessed by ICBC
If your purchase price is significantly below the ICBC assessed value, you will pay tax on the higher amount. This prevents buyers from artificially reducing their tax bill by claiming an unrealistically low sale price.
BC Used Car Exemptions from PST
Certain used car transactions may qualify for PST exemptions in BC:
- Family transfers: Transfers between immediate family members (spouses, parents, children) may be exempt from PST
- Estate transfers: Vehicles transferred as part of an estate settlement
- Gift transfers: Some family gift situations may qualify — verify with BC Finance
- Former spouse/partner: Court-ordered transfers following relationship breakdown
Tips for BC Used Car Buyers
- Budget for 12% tax: Add 12% to any used car price you are considering
- Private sale advantage: You can sometimes negotiate a lower price privately since the seller does not factor in tax collection
- Check ICBC insurance costs: Insurance varies significantly between vehicle types and can affect your total cost
- Negotiate before tax: Always clarify whether advertised prices include tax or not
Use our Canada Car Tax Calculator to estimate your complete costs for any used car purchase in BC.
Disclaimer: This article is for informational purposes only. Tax rates and exemptions may change. Verify current BC PST rules at gov.bc.ca or consult a tax professional.