Are there any tax implications for bringing a US car to Canada?
My uncle decided to give me his old 2006 Mercedes S Class as a gift. I will fly over to the US and drive the car back home. If this helps, he is a US citizen and I'm a Canadian citizen. And will there be a difference if it is classified as a gift or a purchase? And also are there any other charges that apply?
- AlpineLv 67 years agoFavorite Answer
Ok...a forward here-I'm a Canadian who lives near the border I've imported an ATV, a snowmobile and twice accompanied people buying vehicles (car and a pickup).The procedure for any vehicle is the same...You'll have to pay federal tax at the border and provincial sales tax on it based on book value when you register in Canada. How much will depend on what province you live in.SO..to get it into Canada..you'll have to stop at US Customs (yes US Customs) before you leave the USA with it and have the title on the vehicle "cleared" before you enter Canada with it. US customs are kind of finicky about this and it's best if you call them at the border point you'll be crossing at and give them 72 hours notice otherwise you'll be sitting in the Customs office for quite awhile waiting until someone gets bored to process your papers. You should also make sure beforehand the US Customs you leave through AND Canadian Customs port you enter through process vehicle imports (not all of them do)
You'll need a bill of sale,the original certificate of Title and the vehicle registration at US Customs so they can clear title.Your uncle can sell this to you for one dollar or whatever you want.His contact info (name address and phone #) must be on the bill. US Customs will then run the VIN (vehicle identification number) through their system to make sure it hasn't been reported stolen somewhere or being repossessed etc.. Your uncle should make sure he's home and near a phone at the time you're going to cross. After all this is done US Customs will give you a paper to show Canada Customs stating the vehicle is clear for export from the USA. You will have to pay duty on it based on book value at Canada Customs. If the vehicle was American made there would be no duty because of free trade (NAFTA) however in this case you will likely have to pay duty as Mercedes are made outside the USA.You'll also have to register it in the RIV program-the RIV program is a "brokering" firm that allows individuals to import vehicles-since technically,by law an individual CANNOT import a vehicle into Canada without using a Customs broker.This in itself costs around 200 bucks.
After you get the vehicle into Canada you have to take it to an authorized vehicle inspection place to make sure it complies with provincial/federal safety requirements. Here where I live (in N.B) Canadian Tire is the main one -you'll have to check around where you live to see what your options are. You HAVE to have this done before you register it in your home province. When you register it you'll have to pay the provincial portion of any sales tax based on book value. I doubt that there are any exemptions for gifts on something like a car.
I suggest you read the below website over THOROUGHLY as apparently US Customs has placed new restrictions on the export of used vehicles as of April 5. 2014 that require the submission of additional information (something called AES ) 72 hours BEFORE you arrive at the border.(second link) I'm not at all familiar with what that is or what it means but it seems you have to submit a form online 72 hours before you get there to clear title.
- betsonLv 44 years ago
No, there's no gift tax in Canada. You will have to are aware of it's no longer that straightforward to import a vehicle into Canada, if that is your intent. You can ought to contact Canada Border offerings for the forms and protocol.