Purchase of a Used Road Vehicle From an Individual
The GST does not apply on the purchase of a used road vehicle from an individual who is not registered for the GST.
Calculating and paying the QST
If you purchase a used road vehicle registered under the Highway Safety Code from an individual who is not registered for the QST, you must pay the QST to the Société de l'assurance automobile du Québec (SAAQ) when the vehicle's registration is transferred.
The QST is calculated on the higher of the following two amounts:
- the estimated value of the vehicle
- the sale price of the vehicle
Sale between related individuals
When a used road vehicle is transferred between related individuals for a price that is lower than the estimated value (transaction with or without consideration), the QST is calculated on the sale price agreed on by the parties.
The same goes for a used road vehicle brought into Québec following its transfer, outside Québec, between related individuals. In this case, the vehicle's estimated value is not considered in the QST calculation.
The transfer of a used road vehicle between an aunt or uncle and their nephew or niece is considered a transfer between related individuals. QST is therefore calculated on the agreed sale price.
Example of the calculation for an individual not registered for the GST and QST who sells a used vehicle to another individual
An individual sells a used vehicle to another individual for $10,000. The average wholesale price of the vehicle is $13,000 from which $500 is subtracted, giving an estimated value of $12,500. Neither individual is engaged in commercial activities.
| Sale price | $10,000.00 |
|---|---|
| Estimated value of the vehicle | $12,500.00 |
| QST payable ($12,500 x 9.975%) | $1,246.88 |
The GST does not apply in this case because the sale involves two individuals making a non-commercial transaction. The QST applies, however, and must be calculated by the SAAQ on the estimated value since it is greater than the sale price. The vendor, a non-registrant, is not required to calculate the amount of QST payable by the buyer.
The SAAQ always collects the QST when a road vehicle is registered. Note that an individual who is not registered for the QST is not authorized to collect the QST.
Used road vehicles with damage or unusual wear
If you purchase a used road vehicle for less than its estimated value because it is damaged or has been subjected to unusual wear, you can pay the QST on the reduced price.
Conditions
An appraisal report from a certified appraiser must be submitted to the SAAQ when the vehicle is registered.
The appraiser must:
- hold a certificate of professional qualification as an automobile damage appraiser issued by the Groupement des assureurs automobiles
- have prepared the report in the normal exercise of their profession at a certified appraisal centre or an establishment certified by the Groupement des assureurs automobiles
Rebate of QST overpaid
If you paid the QST on the estimated value of the vehicle, you can claim a rebate of the QST overpaid by submitting the appraisal report to Revenu Québec within the prescribed period of time.
Deadline for appraisal report
The appraisal report must be made within a reasonable time, generally within 10 business days after the date of the purchase.
An extension is possible if you:
- explain why you could not get the report earlier
- provide proof that the vehicle was not damaged following purchase
How to apply for a rebate
You can apply using form VD-60.R-V, Application for a QST Rebate for a Road Vehicle.