Reduction of or Exemption from the QST
In certain cases, the Société de l'assurance automobile du Québec (SAAQ) collects the QST on an amount less than a vehicle's estimated value or does not collect it at all. Some transactions can be partially or completely QST exempt for the purchaser. To benefit from an exemption, the purchaser must generally obtain a Certificate of Determination Respecting the QST: Registration of a Road Vehicle (form VDE-23-V) from Revenu Québec before registering the vehicle with the SAAQ. To obtain this certificate, the individual must file form VD-55.1-V, Application for a Certificate of Determination Respecting the QST: Registration of a Road Vehicle, along with the required supporting documents.
Circumstances for exemption
An exemption may be granted, for example, in the following situations:
- a transfer of assets between two businesses that includes the transfer of a vehicle according to an agreement, under the terms of a law, between closely related members of an eligible group or further to a winding-up;
- the repossession of a vehicle by the supplier following the cancellation of a sale;
- the bringing into Québec of a vehicle purchased outside Québec (for example, in Ontario, Newfoundland and Labrador, Prince Edward Island, Nova Scotia or New Brunswick) from a supplier not registered for the QST. This situation gives entitlement to a tax reduction only if the same reduction is granted to residents of the jurisdiction where the sale of the vehicle took place when they purchase a road vehicle in Québec;
- the bringing into Québec of a road vehicle for use by a business;
- the voluntary return of a road vehicle to its real owner as a result of an ownership claim;
- the recovery of a vehicle by a lender that is a QST registrant;
- the purchase of a motor vehicle by a registrant that is not a dealer for purposes of resale or lease for at least one year.
If, upon registering the vehicle with the SAAQ, the purchaser does not have a Certificate of Determination Respecting the QST: Registration of a Road Vehicle (form VDE-23-V), the SAAQ is required to collect the QST on the sale price or the estimated value, whichever is higher. If the registrant did not pay QST on a motor vehicle acquired for resale or for lease for a period of at least one year, the purchaser can apply for a rebate of the QST from Revenu Québec using form VD-60.R-V, Application for a QST Rebate for a Road Vehicle.