How much tax do I pay on a used car in Ontario?

13%, but on the greater of what you paid and the Canadian Red Book wholesale value if you bought privately. Pay $15,000 for a car booked at $19,000 and the tax is $2,470 — $520 more than 13% of the price. From a dealer it is 13% HST on the invoice.

Is it cheaper to buy a car privately in Canada?

Not on tax. Every province taxes private sales. In British Columbia a private sale is 12% PST with no GST against a dealer's 7% PST plus 5% GST — identical below $55,000. In Ontario the rate is the same either way but the private sale is taxed on the Red Book value, so it is *more* expensive whenever you got a bargain.

Can I write a lower price on the bill of sale to pay less tax?

In Ontario and Quebec it changes nothing, because the tax is charged on the greater of the price and a published valuation. Quebec's estimated value is the average wholesale price minus $500; Ontario uses the Red Book. Both provinces allow a genuine appraisal instead, for a damaged or unusually worn vehicle, on their own form.

Which province has the lowest car tax?

Alberta, at 5% on a dealer sale — $1,250 on $25,000 against $3,750 in Prince Edward Island. That is the ordinary sales tax rather than a vehicle rule, and it applies to the car the same way it applies to a fridge.

Do electric cars pay less tax in British Columbia?

Not a lower rate — higher thresholds, which works out the same in the band that matters. A ZEV stays at 7% dealer PST up to $75,000 where a petrol car steps up at $55,000. Those thresholds revert on 22 February 2027.

When do I pay the tax on a private car purchase?

At registration, to the province — ServiceOntario in Ontario, ICBC in British Columbia, the SAAQ in Quebec. Not to the seller, and not at the time of the sale, which is why it is so often left out of the budget.

2026 · private sale and dealer · book value applied

Canadian car tax calculator

Pay $15,000 privately in Ontario for a car the Red Book values at $19,000 and you are taxed on $19,000. The discount you negotiated does not reduce the tax, because the province never looks at your bill of sale.

Written and edited by Pablo Ruiz QuinteroSources checked September 1, 2026Provincial vehicle rules read off Ontario, British Columbia and Revenu Québec on 2026-09-08

Rates 2026Where OntarioPaid to ServiceOntario, when you register the vehicle

Price you are paying

Canadian Red Book wholesale value

Leave at zero if you do not know it. Ontario taxes the greater of this and the price, so a bargain does not lower the tax.

Province or territory

Tax on the purchase

$3,250

$28,250 all in · 13.0% of the price

The breakdown
Price	$25,000
RST 13%	$3,250
Total	$28,250

The same car from a dealer would come to $28,250 — exactly the same, which in British Columbia is by design.

The tax is not always charged on what you paid

This is the part that catches people, and it only happens on private sales. Buy from a dealer and the tax is charged on the invoice, everywhere in Canada. Buy from a person and two provinces look up what the car is worth instead.

Ontario charges 13% RST on *the greater of* the price you paid and the wholesale value in the Canadian Red Book. Pay $15,000 for a car the Red Book values at $19,000 and you are taxed on $19,000: $2,470 instead of $1,950, $520 more than the price suggests. Where the Red Book value is under $1,000 the price governs, and a damaged car can be appraised by a licensed dealer or a Ministry of Finance appraiser instead.

Quebec does the same with a different book: 9.975% QST on the greater of the agreed price and the estimated value, which Revenu Québec defines as the average wholesale price minus $500. Transfers between related individuals are taxed on the agreed price, and a damaged vehicle can be taxed lower with an appraisal filed at the SAAQ.

The practical consequence is the same in both: agreeing a low price on paper does not lower the tax, because the province never looks at the paper. Enter the book value in the calculator above and you will see what you will actually be asked for at the counter.

And buying privately is not automatically cheaper

The received wisdom is that private sales dodge the tax. They do not — every province taxes them — and in British Columbia the arithmetic is deliberately arranged so that it makes almost no difference.

A B.C. private sale carries 12% PST and no GST, because a private seller is not a registrant. A dealer sale carries 7% PST plus 5% GST. On $40,000: $4,800 privately against $4,800 from a dealer. Identical, to the dollar.

Above $55,000 the dealer rate starts to climb in one-point steps — 8%, then 9%, then 10% — while the private rate stays at 12%. And at $125,000 both jump to 15%, at $150,000 to 20%. Since the dealer also charges GST on top, the private buyer wins at the expensive end: on $130,000 it is $19,500 privately against $26,000 from a dealer, a difference of $6,500.

Ontario is the mirror image. 13% either way, but the dealer taxes the invoice and the private sale taxes the Red Book. So in Ontario private buying is cheaper only when you pay at or above book value — which is to say, when there was no bargain to begin with.

British Columbia's electric thresholds run out on 22 February 2027

B.C. does not give zero-emission vehicles a lower rate. It gives them higher thresholds, which amounts to the same thing in the band where it matters: the 8% step starts at $75,000 for a ZEV instead of $55,000, and the 10% band runs to $124,999 from $77,000 rather than $57,000.

On a $70,000 car that is $8,400 for a ZEV against $10,500 for a petrol equivalent — $2,100 of difference created purely by where a threshold sits.

It has an end date. The bulletin says these rates run until 22 February 2027, after which they return to the old ones. If you are choosing between this year and next on a ZEV above $75,000, that date is worth more than most of the incentives being advertised.

The same $25,000 car from a dealer, in all thirteen

A dealer sale is an ordinary taxable supply, so the rate is simply the province's GST, HST or GST-plus-PST. Cheapest first:

1. Alberta — $26,250, $1,250 of tax at 5%.

2. Northwest Territories — $26,250, $1,250 of tax at 5%.

3. Nunavut — $26,250, $1,250 of tax at 5%.

4. Yukon — $26,250, $1,250 of tax at 5%.

5. Saskatchewan — $27,750, $2,750 of tax at 11%.

6. British Columbia — $28,000, $3,000 of tax at 12%.

7. Manitoba — $28,000, $3,000 of tax at 12%.

8. Ontario — $28,250, $3,250 of tax at 13%.

9. Nova Scotia — $28,500, $3,500 of tax at 14%.

10. Quebec — $28,744, $3,744 of tax at 14.975%.

11. New Brunswick — $28,750, $3,750 of tax at 15%.

12. Newfoundland and Labrador — $28,750, $3,750 of tax at 15%.

13. Prince Edward Island — $28,750, $3,750 of tax at 15%.

The spread on a $25,000 car is $2,500, and it is the same spread as on any other purchase — this is not a vehicle rule, it is the ordinary sales tax. Where vehicles become their own subject is the private sale, and that is where the provinces diverge.

Nobody hands the tax to the seller

On a private sale you do not pay the tax to the person selling you the car. You pay it to the province when you register, which means it lands after the handshake and is easy to forget in a budget.

Ontario — collected by ServiceOntario, when you register the vehicle.

British Columbia — collected by ICBC, when you register the vehicle.

Quebec — collected by the SAAQ, when the registration is transferred.

That timing matters for a reason beyond budgeting: the amount is decided at the counter, by the province's own valuation, not by your bill of sale. If the figure surprises you there, the appraisal route is the remedy and it has to be done properly — by a licensed dealer or an authorised appraiser, on the province's own form.

What this does not do

Private-sale rules are here for Ontario, British Columbia and Quebec, whose own documents were read for this page. Alberta, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Northwest Territories, Nunavut, Prince Edward Island, Saskatchewan, Yukon each handle a private sale in their own way, and none of those is shown rather than guessed at. The dealer figure is right in all thirteen.

— The federal luxury tax on vehicles priced above $100,000 is not included. It is charged on the sale by the vendor and it forms part of the base the GST/HST is then charged on, so where it applies the real total is higher than shown.

— Registration, licence plate and transfer fees are not included. They are not tax, they are administrative charges, and each province sets its own.

— Trade-ins are not applied. In several provinces the tax is charged on the price after a trade-in is deducted, which can be worth more than any other decision in a purchase.

— Exemptions are not applied: gifts between qualifying family members, transfers on death, First Nations purchases on reserve and several others remove the tax entirely, each with its own paperwork.

The luxury tax deserves a word of its own because it compounds: it is charged by the vendor on vehicles above $100,000 and then the GST or HST is charged on a base that includes it. Tax on tax, legally, and not in the figure above.

Where these rules come from

Three provincial documents and one federal, each read on the date shown:

Government of Ontario — Retail Sales Tax: specified vehicles — read 2026-09-08. https://www.ontario.ca/document/retail-sales-tax/specified-vehicles

Province of British Columbia — Bulletin PST 308, PST on Vehicles (revised August 2026) — read 2026-09-08. https://www2.gov.bc.ca/assets/gov/taxes/sales-taxes/publications/pst-308-vehicles.pdf

Revenu Québec — Purchase of a used road vehicle from an individual, and the estimated value rule — read 2026-09-08. https://www.revenuquebec.ca/en/citizens/consumption-taxes/taxable-zero-rated-or-tax-exempt-goods-and-services/gst-and-qst/transport-and-road-vehicles/road-vehicles-individuals/purchase-of-a-used-road-vehicle-from-an-individual/

CRA — Charge and collect the GST/HST: which rate to charge (the dealer case in all 13) — read 2026-09-07. https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/gst-hst-businesses/charge-collect-which-rate.html

The British Columbia bulletin is the one worth opening if you are buying there: it was revised in August 2026 and the rate tables in it are the whole answer.

Where to go next

GST, HST, PST and QSTThe same tax on everything that is not a car.Land transfer taxThe other purchase the province taxes at registration.Property tax calculatorWhat owning costs each year, as opposed to buying.All Canadian calculatorsIncome tax, paycheque, RRSP and the rest.

Questions

How much tax do I pay on a used car in Ontario?: 13%, but on the greater of what you paid and the Canadian Red Book wholesale value if you bought privately. Pay $15,000 for a car booked at $19,000 and the tax is $2,470 — $520 more than 13% of the price. From a dealer it is 13% HST on the invoice.
Is it cheaper to buy a car privately in Canada?: Not on tax. Every province taxes private sales. In British Columbia a private sale is 12% PST with no GST against a dealer's 7% PST plus 5% GST — identical below $55,000. In Ontario the rate is the same either way but the private sale is taxed on the Red Book value, so it is *more* expensive whenever you got a bargain.
Can I write a lower price on the bill of sale to pay less tax?: In Ontario and Quebec it changes nothing, because the tax is charged on the greater of the price and a published valuation. Quebec's estimated value is the average wholesale price minus $500; Ontario uses the Red Book. Both provinces allow a genuine appraisal instead, for a damaged or unusually worn vehicle, on their own form.
Which province has the lowest car tax?: Alberta, at 5% on a dealer sale — $1,250 on $25,000 against $3,750 in Prince Edward Island. That is the ordinary sales tax rather than a vehicle rule, and it applies to the car the same way it applies to a fridge.
Do electric cars pay less tax in British Columbia?: Not a lower rate — higher thresholds, which works out the same in the band that matters. A ZEV stays at 7% dealer PST up to $75,000 where a petrol car steps up at $55,000. Those thresholds revert on 22 February 2027.
When do I pay the tax on a private car purchase?: At registration, to the province — ServiceOntario in Ontario, ICBC in British Columbia, the SAAQ in Quebec. Not to the seller, and not at the time of the sale, which is why it is so often left out of the budget.