Buy or sell a used vehicle in Ontario

Know the steps you need to take to buy or sell a used vehicle in Ontario.

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Sell a used vehicle

If you are selling a vehicle to a close family member you may be allowed to transfer ownership of your vehicle to a family member without paying the retail sales tax.

Before you sell a used vehicle, you need to:

• buy a Used Vehicle Information Package
• make sure that the Vehicle Identification Number ( VIN ) on your vehicle matches the number on your permit (your green ownership document)
• check to ensure the vehicle has no money owing on it

As the seller you are legally required under the Highway Traffic Act to provide the buyer with a used vehicle information package.

When you sell

When you sell your vehicle, you need to give the buyer:

• the Used Vehicle Information Package
• a signed Bill of Sale with your name, the buyer’s name and address, the date and purchase price
• a completed and signed Application for Transfer — this is found on the back of an ownership permit, under the vehicle portion
• a certificate that verifies the vehicle meets safety standards (if required)
  • you will need to get this from a licensed mechanic
  • look for a green and white sign with “Ontario Motor Vehicle Inspection Station” on it

  You keep:

  • your licence plates (because plates travel with a driver, not a vehicle)
  • the “plate portion” of your permit (ownership)
    • you will need this if you want to register your plates on another vehicle
    • you can also request a refund for any full months left on your plate stickers if they were required for your vehicle

    Finding out if money is owed on a vehicle

    A Used Vehicle Information Package will tell you if there is any debt/money owing on your vehicle.

    If there is a lien (a form of security put on a vehicle to ensure its owner pays any debt that is outstanding) on the vehicle, you can contact the Ministry of Government and Consumer Services, Personal Property Security Branch, for more information:

    Buy a used vehicle

    If you are buying a vehicle from a close family member you may be allowed to transfer ownership of the vehicle from a family member without paying the retail sales tax.

    Before buying a used vehicle you should:

    • check the vehicle history – including maintenance records
    • check the vehicle’s emissions testing history on the emissions testing website.
    • you will need the Vehicle Identification Number ( VIN ) to run this free search.
    • emissions testing is only required for heavy diesel commercial motor vehicles.
    • although light passenger and non-diesel vehicles do not require emissions tests, all vehicles on the road are subject to emissions standards.
    • you can ask the vehicle seller to perform an emissions test at an auto service centre and provide you with the results before buying the vehicle to ensure it does not have any emissions problems.
    • make sure the seller is the legally registered owner
    • make sure the VIN on the vehicle matches the one on the owner’s permit
    • request from the seller or purchase a Used Vehicle Information Package and check the lien/debt information
    • look for obvious signs of damage and have your mechanic inspect the vehicle for you
    • test drive the vehicle

    When you buy

    When you buy a vehicle, ensure the seller gives you:

    • the vehicle portion of the owner’s permit with the completed portion on the back
    • the Used Vehicle Information Package, including the Bill of Sale with the name of the seller and purchase price.
      • the Bill of Sale must be signed and dated by both the buyer and seller

      Register a used vehicle

      You must register your name as the new owner of the vehicle within 6 days of the purchase.

      To register the vehicle, you need to visit a ServiceOntario centre and bring the following:

      • proof of insurance
      • your Ontario Driver’s Licence
      • used vehicle information package ( UVIP )
      • bill of Sale (you can use the bottom of the used vehicle information package, as there is a section specifically for this)
      • safety Standards Certificate ( SSC ), if applicable
      • annual or semi-annual emission and safety inspection, if applicable
      • owner’s permit with the completed Application for Transfer portion on the back
      • odometer reading information

      Bill of sale

      You must include the following information on a bill of sale for the purchase of a used or new vehicle:

      • vehicle identification number (VIN)
      • make, year and power source for motor vehicles (gas, diesel, electric)
      • body type, colour and model (if available)
      • purchase price (taxes collected and HST/GST number if applicable)
        • Some exemptions may apply. For example, when transferring a vehicle to a family member as a family gift, the Sworn Statement for a Family Gift of a Used Motor vehicle in the Province of Ontario is required. This form is available online at ServiceOntario.ca or in person at your nearest ServiceOntario centre.

        The bill of sale must be an original document, but it can be handwritten. We will also accept a pre-printed bill of sale with a handwritten HST/GST number.

        • A photocopy or facsimile of the bill of sale is acceptable if either:
          • the original is viewed and photocopied at a ServiceOntario centre
          • the original and the photocopy are viewed at the ServiceOntario centre
          • the facsimile is sent directly from the seller to the ServiceOntario centre

          Fees

          You need to pay fees to register your vehicle. Fees vary based on location and vehicle class.

          Tax on used vehicles

          Who pays: the buyer pays the sales tax when you register as the new legal owner of the vehicle. You do not pay sales tax to the seller.

          How much: In most cases, buyers pay 13% RST in Ontario. The amount is based on the purchase price or the vehicle’s wholesale value, whichever is greater.

          Appraisals: If the vehicle is 20 years old or older, you will require an appraisal. For more information please read about Specified vehicles from the Ministry of Finance.

          Tax exemptions: You do not need to pay sales tax if you are:

          • transferring the vehicle to a close family member as a gift
          • a qualifying diplomat or Status Indian

          Finding out the wholesale price of your car

          Wholesale value is based on the Canadian Red Book which has the wholesale and retail values of used vehicles. It is an industry standard used by car dealers, insurance companies and other provincial governments.

          The values are based on the average amounts paid for vehicles of the same year, make and model. They don’t take into account:

          • optional equipment
          • vehicle condition
          • mileage.

          These values can change from the day you pick up the Used Vehicle Information Package to the day the vehicle is transferred.

          If you paid less than the Canadian Red Book value

          If you paid less than the Canadian Red Book value, you can get the vehicle appraised before changing ownership.

          If the appraisal supports a lower price than the Canadian Red Book, you will pay tax based on the higher of the purchase price and the appraised value.

          Emissions test

          Heavy diesel commercial motor vehicles

          Used heavy diesel commercial motor vehicles with a model year older than the current year require a valid emissions test pass when they are sold in order to transfer the ownership.

          Applicable vehicles include transport trucks, pickup trucks, delivery vans, buses, tow trucks, dump trucks and cement trucks that have a registered gross weight of more than 4,500 kg and run on diesel fuel.

          Light passenger vehicles and heavy non-diesel vehicles

          As of April 1, 2019, light passenger vehicles (most cars, vans, SUVs and light trucks) and heavy non-diesel vehicles no longer require an emissions test.