Car Sales Tax Calculator
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Use our Canada car tax calculator to find out how much tax you would be paying when purchasing a car and find out which provinces have the lowest tax rate.
How does car tax work?
When buying a used car in Canada you will need to register it with the provincial authorities where you live and pay the sales tax. The total sales tax is calculated as a sum of the federal GST and the provincial PST.
Note that there are variables that affect how much tax you will pay including the province you are registering in, the value of the vehicle you are purchasing and whether you have a used car of your own to trade in.
Is sales tax the same across Canada?
While the GST is federally set and is consistent across Canada, the PST varies between provinces. Have a look at the table below:
|Province or Territory||Type(s)||PST/QST/RST||GST||HST||Total Tax Rate|
|British Columbia||GST + PST||7%||5%||-||12%|
|Manitoba||GST + RST||7%||5%||-||12%|
|Newfoundland and Labrador||HST||-||15%||15%|
|Prince Edward Island||HST||-||15%||15%|
|Quebec||GST + QST||9.975%||5%||-||14.975%|
|Saskatchewan||GST + PST||6%||5%||-||11%|
However, when we are dealing with used cars there are some specific variables. For example, in BC the rate of PST that must be paid varies with the value of the vehicle.
|Value of the used car||Rate of PST|
|55,000 to 55,999||8%|
|56,000 to 56,999||9%|
|57,000 to 124,999||10%|
|125,000 to 149,999||15%|
How do I calculate my car tax?
Using the tool above, first, you must input the province in which you intend to register the vehicle. Next, you specify under what arrangement you are obtaining the vehicle: from an individual, from a dealership, by rental agreement or via a donation.
After entering the value of the vehicle you will see figures for the GST (Goods & Services Tax) and the PST (Provincial Sales Tax). These are combined together to give the HST (Harmonized Sales Tax). The figure for the HST is the amount you must pay in car tax.
What if I buy a car from a different province?
Perhaps you are considering buying a car in a province with a lower rate of PST?
The first issue you will encounter is getting it home without having registered the vehicle. You may be able to apply for an In-Transit Permit (cost: around $24) to drive it without registration. Otherwise, you will have to arrange and pay for it to be transported for you.
Additionally, once the vehicle is inside your province, you will need to transfer its title and registration from the province it was previously registered in. This service typically costs between $80 and $150.
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What is the trade-in tax savings advantage?
The trade-in tax savings advantage works in the following manner. The taxable value of the car you are purchasing is reduced by the value of the car you are trading in.
Let's take an example. Say you are buying a used pick-up truck in Prince Edward Island and you have a Volkswagen Golf to trade in. The pick-up truck costs $35k and you can trade in the Golf for $5k.
Prince Edward Island has an HST rate of 15% meaning that normally you would $5,250 to pay in tax. With the trade-in however you can reduce the taxable value like this:
$35,000 - $5,000 = $30,000
15% of $30,000 = $4,500
Therefore the trade-in not only reduces the price of the purchase but also, in this case, reduces your tax bill by $750.
What is luxury car tax?
The Federal Luxury tax is set to come into effect in September 2022 and will affect cars with a value of $100,000 or more. It is applied before HST and is calculated at 20% of the value above $100k or 10% of the full value of the vehicle, whichever is the lesser.
Let's take an example. Let's say you are buying a used Bugatti for $3,000,000 in Yukon.
20% of the value above $100k would be 20% of 2,900,000 which is $580,000.
10% of the whole value is 10% of $3 million which is $300,000.
In this case, the calculation is lesser and therefore applies.
The HST on the Bugatti would be $150,000.
Total car tax would be: $300,000 + $150,000 = $450 000