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How Much Tax Do You Pay on Used Cars

Depending on where you live in Canada, you can pay very different tax rates on used vehicle purchases. It’s important to understand what rules apply to your jurisdiction, as both provincial and federal taxes can be part of the equation. Do these rules apply when you are getting cash for junk cars in Calgary, for instance? We get to the bottom of this and more below.

Do You Pay Federal Taxes on Your Junk Car Sale?

No matter where you are in the country, the federal government will get its cut. For used car sales, this amount is 5% of the sales price. 

Do You Pay Provincial Taxes on Your Junk Car Sale?

When it comes to paying provincial taxes, the fees vary from province to province. We will be looking at what the taxes would be in Alberta and British Columbia.

Taxes in Alberta

The tax system for used cars in Alberta is very straightforward, in that you will not have to pay more than the federal taxes on the purchase. According to the Government of Alberta’s website, they put the majority of their attention on out-of-province inspections and ensuring the safety of all vehicles on the road.

Ben Franklin's fear: Tax

Taxes in British Columbia

Unfortunately, when it comes to taxes in British Columbia, there could not be a greater contrast than Alberta. This is due to the relative complexity of the system to the west. According to driving.ca, the system has a progressive tax rate that increases with the price of a vehicle. This information is confirmed by rightride.com, which further indicates that the Provincial Sales Tax (PST) will be collected when you register the vehicle with the province. 

Get Cash for Junk Cars Today!

If you are looking to get rid of an old car, contact us today. We provide free towing at a convenient time for you and several other benefits, so don’t delay!

Our Cash for Junk Cars program is recognizable for its simplicity and value. We purchase all vehicle makes and models, regardless of their condition, and pay top dollar to take them off your hands. Our straightforward approach means we collect your car and give you cash, totally hassle-free. If you accept our offer, we’ll confirm proof of ownership before towing it away for free. Get the best cash for junk cars service in Calgary, Edmonton or Kelowna — contact us today!

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