Private sellers trading vehicles, do they pay tax? Hardly found any info online that is BC specific... Basically my question is, 2 people trade vehicle with each other, when they go to register/transfer, will they pay hst? In the example I will say it is a straight trade. I know when you trade your car into the dealer you only pay tax on the difference. Relative info here: http://www.sbr.gov.bc.ca/documents_l...ns/ctr_001.pdf Quote:
thx guys for any info :) edit: this thread was kind of similar but didn't give a straight answer http://www.revscene.net/forums/icbc-...html?p=7238591 |
i think you only pay if there is some cash exchanging hands but am not fully sure... |
last time i did a trade.. i dealt it as a sale and used the transfer papers stating the value of the car and paying tax accordingly |
^How long ago was that? So you basically said the market value of my new car is $x,xxx then paid the tax on that? |
I recall there was a form or a section on the transfer form pertaining to trades. Tax is only paid on the difference in transaction value of the 2 vehicles. |
even if u do a "cash only" transaction, when u register the vehicle, and go get insurance for the vehicle, you will pay taxes on the amount written down for value of vehicle on registration. |
paying taxes again and again and again... |
AFAIK you need to pay tax for that. Not sure about the amount. Ownership transfer is not taxable when both party are family related (parents to children or between siblings). My brother transferred his car 2 years ago. |
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Actually, I've got a transfer form handy, heres what it reads..... Tax Calulation Other than Dealers Purchase Price: Less Trade(If applic.): Net Purchase price: SST/TDP Payable: HST(BC) Payable(If applicable): The wording of this makes me feel like you would only pay tax on market value difference? |
Yes, that's the section I was referring to. I thought I had read something like that when we got our car privately a few months ago (not through trade though). I've never heard of paying tax based on market value of the car, but only on actual transaction value. We sold our old car lower than market value and the buyer only had to pay the tax based on sale price as there are many factors that can obviously affect a car's true value. So you should only have to pay tax on the actual difference in prices like you would at a dealer, not the 'market value' |
Thanks^ Seems to make sense to me now. |
when i traded in my 2004 subaru for the 1997 mercedes i paid no ax at all even when it was through the dealer - i got the price difference back in a check with no mention of tax deduction whatsoever... so if it was a equal value trade i would think it is exempted from tax. hst is for when you spend money, not for if you barter things imo. Posted via RS Mobile |
Two private sellers trading cars of equal value should pay no tax. If there is any cash exchanging hands, the one who paid pays tax that amount of cash, it has nothing to do with the market value. If they deem the trade (or purchase for that matter) to not be of market value, there is a waiver/disclaimer section that you need to fill out stating the reason why. |
Bump. Wondering if the private trade happened in the end and was the resulting taxes paid just the difference in your vehicles prices? |
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