If you’ve ever bought or sold a used vehicle to a private individual, you knew the trick: cars more than nine years old were no longer listed in the reference guide used by the Société de l’assurance automobile du Québec (SAAQ). All you had to do was get a receipt for the transaction for a symbolic $1, and you paid no QST, the provincial (and only) tax that applies to car sales between private individuals in Quebec.
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Here’s an example. Until December 31, 2024, two persons transferring the registration of a 2014 Honda CR-V could have declared they had agreed on a sale price of $1. The transaction would then send but one measly dime (10 cents) of tax into provincial coffers. Yet, according to Kijiji’s latest listing, a ten-year-old Honda CR-V is still worth in the neighbourhood of $12,500. In essence, we’re about $1,247 in tax avoidance.
$255 million over five years
This “under-reporting” fraud is so widespread in Quebec that in 2022 (the most recent statistics available) of the 200,000 used vehicles some 10 years and older sold in La Belle Province, more than two-thirds (130,000 transactions) claimed a selling price of $1.
In his March 2024 budget, the Quebec Minister of Finance, Éric Girard, announced new regulations that would spell the end of this practice. Well, now it’s done: as of January 1, 2025, the estimated value of used vehicles between 9 and 14 years old are now showing in the Guide d’évaluation Hebdo: automobiles et camions légers. (Note that this guide is offered via subscription and, therefore, is not available for public consultation.)
This means that for used vehicles less than 15 years old, the QST is now being calculated on the higher of the following two amounts: the estimated value as it appears in the reference tool; or the selling price declared by both parties.
By extending the number of reference years published in the Guide d’évaluation by five years, Revenu Québec expects to collect up to $60 million more per year—nearly $255 million over five years. (With the resale values so high for used cars these past few years, we suspect the provincial coffers might actually gain as much as half a million dollars, ourselves.)
A few exceptions, of course
A few exceptions that were already in the law remain. For example:
- If a used vehicle is sold between “related individuals” at a price less than the estimated value, QST is calculated on that (lower) agreed price. “Related individuals” include spouses; and persons related by blood, marriage, or adoption. (Revenue Québec gives this example: “A related individual can be a person’s child, grandson, father, grand-mother, brother or the spouse of his or her brother, or the child, father, or mother of the person’s spouse. A person’s nephew, niece, uncle or aunt is not a related individual.”
- If the used vehicle is damaged or “abnormally worn,” the buyer will obviously want to pay less than the estimated value. The QST can then be applied to this reduced price, but only if it is supported by an appraisal report delivered from a professional.
- The QST applies even to the donation of a used vehicle that is subsequently registered, except in the case of an estate or a transfer in “payment of rights” between two individuals who are divorcing.
And this hasn’t changed: buyers of collector cars (road vehicles 25 years or older and trucks 40 years or older) must pay QST based on the value stated on their insurance policy, or determined by a professional appraisal.
Finally, for models from high-end marques like Aston Martin, Bentley, Ferrari, Hummer, Lamborghini, Lotus, Maserati, and Rolls-Royce, if the cars that are less than 25 years old but not listed in the SAAQ’s reference tool, they will be subject to the QST based on their estimated value—which must also be determined by a professional appraiser.
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