The short answer is yes — you pay tax on used cars in Canada. Every province and territory charges some form of sales tax on used vehicle purchases. The rate and collection method vary by province, but tax is always part of the purchase equation.
Do You Pay Tax on Used Cars? — By Province
Used Car Tax by Province — 2025
| Province | Tax Rate | Tax Type | Who Remits |
|---|---|---|---|
| Alberta | 5% | GST only | Buyer to registry |
| Saskatchewan | 11% | GST + 6% PST | Buyer to SGI |
| Manitoba | 12% | GST + 7% PST | Buyer to MPI |
| BC | 12% | GST + 7% PST | Buyer to ICBC |
| Ontario | 13% | HST 13% | Buyer to ServiceOntario |
| Quebec | 14.975% | GST + 9.975% QST | Buyer to SAAQ |
| Atlantic (NS, NB, PEI, NL) | 15% | HST 15% | Buyer to registry |
Dealer vs Private Sale — Tax Difference
Dealer purchases: The dealer collects and remits the sales tax to CRA/provincial revenue. Tax is included in the advertised price (before additional fees).
Private purchases: You pay the tax directly to your provincial vehicle registry at time of registration. You must bring a signed bill of sale. Tax is calculated on the higher of purchase price or MVDA assessed value.
How Much Is Tax on a Used Car?
| Price | Alberta (5%) | Ontario (13%) | Quebec (14.975%) | Atlantic (15%) |
|---|---|---|---|---|
| $10,000 | $500 | $1,300 | $1,498 | $1,500 |
| $20,000 | $1,000 | $2,600 | $2,995 | $3,000 |
| $30,000 | $1,500 | $3,900 | $4,493 | $4,500 |
| $50,000 | $2,500 | $6,500 | $7,488 | $7,500 |
Exemptions and Special Situations
- Family transfers: BC allows PST exemptions for immediate family transfers. Other provinces have varying rules.
- Estate transfers: Vehicles transferred after death may have reduced or zero PST in some provinces.
- Emergency vehicles: Police, fire, and ambulance vehicles may be exempt from luxury tax surcharges.
- Commercial vehicles: Vehicles with proper commercial registration may qualify for different tax treatment.
Disclaimer: Tax rates and rules vary by province and change frequently. Verify current rates with your provincial vehicle registry before purchase.