There are a lot of people that want to buy cars in Ontario. Not everybody wants to buy a new one. For this reason, they will opt to buy a used vehicle. Once doing this they get faced with many questions. About what it is going to cost them besides the actual price of the vehicle itself.
Do You Have to Pay Sales Tax on a Used Car?
Some individuals have some type of tax exemption. If they don’t, they will most likely have to pay the retail sales tax on the used vehicle that they are buying. What must be kept in mind is that this is not paid to the individual that is selling the vehicle. This tax on used vehicles gets paid at the time the vehicle is being registered.
How much the tax is going to be will depend. It is going to depend on the actual purchase price that was paid for the vehicle. Or, it may be that the taxes are going to get charged on the wholesale value of the vehicle. One of the reasons for this is that many people will buy a car and then report that they paid far less for it. To combat this, the government has implemented a system. Whichever is greater such as the price of the sale or the value is what the taxes will get put on.
It is not uncommon for family members to want to give their vehicle to another family member. This gets classed as a gift. When this takes place the transferring of the vehicle is not going to have any tax attached to it. The only other exemption to paying the taxes if one is qualified as a diplomat. Or, if one has their Indian status.
Is There HST on Used Cars in Ontario?
Whether you are going to have to pay HST or not is all going to depend on where the car was purchased from. There are a lot of people that sell their vehicle privately. Buyers who buy them from private owners will not have to pay the HST tax. Those buying from a dealership even though it is a used car will most likely have to pay the HST on this vehicle.
How Much are Licencing Fees When Buying a Car?
One of the costs that are going to come with buying the used vehicle is the registration fees. The cost for this is going to depend on what part of Ontario an individual is having this done. In Southern Ontario, for example, it will cost $120. If it is in Northern Ontario, the cost is half of this. This is a cost that gets applied to the license plate sticker. These are mandatory to have on all passenger vehicles. There will be other costs such as a license plate renewal and a replacement with the permit which will be $59. If only the vehicle permanent is needed than the cost is $32.
How Much Does it Cost to Certify a Used Car?
Certifying a used car means that it is going to have to pass a safety inspection. When one goes to get their plates for their car they are going to have to be able to provide some verification. That the car has passed a safety inspection. It doesn’t matter whether the car is being bought from a private owner. Or through a dealership this is mandatory. It is a law that dates all the way back to 1974. Safety inspections for a vehicle must get carried out at proper facilities. Ones that have been registered by the Ministry of transportation to be able to do this type of inspection.
The cost of doing this can vary depending on the region where it gets done. It can be anywhere between $60-$90. Sometimes the vehicle requires some type of repair. To bring it up to safety standards. These are going to create extra costs. What one has to be careful about is that they are not getting a warranty or guarantee inspection. For the used car it requires the safety standards certificate. This certificate is only good for 36 days from the time that it gets inspected. Individuals getting their car safety check should make sure that they plan properly. To get all the rest of the transfer and registration done. Within that period.
Things to Remember When Buying a Used Vehicle in Ontario
There are many pros and cons that come with buying a used vehicle. There can be certain risks involved. The type of risk is all going to depend on where one buys their used vehicle from. In Ontario, there are many people that are selling used vehicles privately. There are also a lot of used car dealerships.
It is the responsibility of the buyer to ask as many questions as possible regarding the vehicle. There are certain regulations that the seller must follow. When selling a used vehicle. Quite often in the private sector, they do not follow all these regulations.
Know the Fair Pricing
You should be somewhat aware of what the price range is for the vehicle that you are considering buying. You can refer to the Redbook. Which is going to give you the approximate value of the vehicle that you want to buy.
Something else you are going to want to do is test drive the vehicle. No matter whether you are buying it privately or through a dealership. During this time you want to observe many different components of the vehicle. Including the small items. Such as if the gas gauge is working as well as whether the mileage is registering properly. Or even if the power windows are working properly.
The law in Ontario requires private sellers to provide a used vehicle information package. This is something that they get from the Ministry of transport. It is comprised of various sections of information that has to get filled in. You can also get a car proof verify report which is going to give you the history of the vehicle. You will have to pay for this. But it is a worthy investment. As it will give you a lot of extra information about the vehicle that the seller may not have.