Used Property

Sales of used property

As a rule, the sale of used property (including property seized or repossessed by a creditor) is taxable at 5% GST and 9.975% QST. Consequently, an antique dealer that is a registrant must, in most cases, collect the taxes on furniture sold. However, used property is not taxable if sold by a person not engaged in commercial activities, with the following exception: under the QST system, road vehicles that must be registered under the Highway Safety Code are QST-taxable even if the vendor is not engaged in commercial activities. In such cases, the QST is collected when the vehicle is registered.

Persons that occupy a space at a flea market (referred to as “occupants”) are subject to the same rules as most other merchants, regardless of whether the merchandise they sell is new or used. Under the QST system, persons that make the selling space available must submit a list of the occupants (containing certain information) to Revenu Québec. For more information, click Flea Markets.

Purchases or trade-ins of used property

If you accept used property as a trade-in for property you sell, special rules apply to the transaction, depending on whether or not the person trading in the property (the vendor) is a registrant.

The vendor is a registrant

If the vendor is registered for the GST and the QST, the vendor must collect GST and QST on the value of the property traded in, inasmuch as the property was used in the course of the vendor's commercial activities. As the person accepting the trade-in, you must collect GST and QST from the vendor on the full sale price of the property you sell. There are, consequently, two separate transactions.


Your company, ABC, sells machinery to XYZ company for $50,000. You grant $20,000 on the trade-in of XYZ's used machinery. Both companies are registrants.

Invoice prepared by ABC
Amount paid by XYZ$34,492.50
Sale price$50,000.00
GST (5% × $50,000)+$2,500.00
QST (9.975% × $50,000)+$4,987.50
Trade-in (including taxes)$22,995.00
Invoice prepared by XYZ
Sale price$20,000
GST (5% × $20,000)+$1,000
QST (9.975% × $20,000)+$1,995

Both you and the vendor may claim an input tax credit (ITC) and an input tax refund (ITR) for the taxes paid, since the property in each case was acquired in the course of commercial activities. The amount of GST and QST collected must be indicated on both the invoice prepared by the vendor and the invoice prepared by you.

The vendor is not a registrant

If the vendor is not registered for the GST and the QST, the vendor does not collect GST and QST on the value of the traded-in property. As the person accepting the trade-in, you must calculate the taxes on the net amount of the sale, that is, on the sale price of the item minus the trade-in value. There is an exception for trade-ins of Road Vehicles under the QST system.


Your company, Green Grass Inc., sells a lawnmower to Mr. Johnson for $500, and grants $100 for the trade-in of Mr. Johnson's old lawnmower. Green Grass Inc. is a registrant, Mr. Johnson is not.

New lawnmower$500.00
Lawnmower traded in$100.00
GST (5% x $400)+$20.00
QST (9.975% x $400)+$39.90
Amount payable$459.90

Green Grass Inc. is not entitled to an ITC or an ITR.

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