Car Buying-Canada

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Some downtown residents of major cities exist without owning a car. They commute to work on public transit and rent a car if they need one at the weekend. Major cities have shared ownership carpools as well and these are an option for a city dweller.

However, North America is car country and most households have one car/truck per adult. One of the first things you will want to do in Canada is get some transport.

Canada is different from the UK in that very few people drive company cars. Maybe traveling salesmen may have a company car (though many don’t) or someone working in a remote location off road may be given a company truck to get to work. The overwhelming number of people use their own vehicles. This results in a different car market:

  • Many people rate reliability and longevity above marque. Hence the popularity of Asian cars and North American trucks.
  • Nearly new cars are relatively expensive compared to the UK. If you expect a car to last 10-12 years then a two year old one still has 80/85% of its useful life.

Additional costs for buying a car in Canada

Sales Tax

Unlike the UK, sales tax is payable whether you are buying a new OR a second hand car. It is payable in secondhand cars whether you buy through a dealer or privately.

Whenever you see prices for vehicles (or pretty much anything else in Canada!) they will exclude sales taxes. You need to add GST at 5% plus any provincial sales tax or HST at 12%, 13% or 15% depending on province.

Technically, you do not pay tax if you buy a used car in a private sale. However, in PST and HST provinces you will still be required to pay an equivalent levy on the purchase price when you register the vehicle. Immediate family members can transfer vehicles at no cost, but otherwise the Government will want a convincing explanation if the price is significantly different from market value.

New pst taxation for BC after April 2013 - details here:

Safety Inspection / Certificate

There is no Canadian equivalent of the UK MOT. However, when a car is sold, there may be a requirement that the car has a safety inspection certificate (and this is likely to be required if you are importing a car from another Province). The dealer will often include the cost of this in the sticker price, but if buying privately, the buyer will have to pay for this from an authorised mechanic. Depending on the Province and if you are importing or not, this may one of the documents required before you can buy the licence plate for the vehicle.

Vehicle emissions test

An emission certificate is required (in some provinces but not others) every two years. There must be a test certificate that is still in date at the time of the sale.

Licence Plate

Unlike the UK, in Canada you must obtain your own licence plate. The requirements for how to go about this vary by province. If buying from a dealer, they will often do this for you. If buying privately, you must do it yourself. This is the way that provinces can check for safety certificates and collect tax when you buy a vehicle.

Licence Sticker

You must also buy a sticker that is affixed to the licence plate when you get the plates. This is the Canadian equivalent to the UK 'Vehicle Excise Duty' (i.e. 'Road Tax'). In some provinces they make the expiry date of the sticker the same as your month of birth in the first year. You must buy new stickers every year.


See car insurance-Canada category

Car insurance is mandatory across Canada, but it varies, both in cost and how to do it, by the Province you're in - roughly half of the Provinces (including BC and Quebec) operate government insurance, where you must buy at least basic insurance from the Provincial monopoly. The other half (including Ontario and Alberta) you have to navigate the private market as best you can.

Driving License

See Driver's Licence-Canada

Researching a vehicle

You can buy some, but not all, models you are familiar with from the UK as well as many North American vehicles. “European” makes available include VW (although some models are manufactured in Mexico), BMW, Mercedes, Saab and Volvo. Japanese and Korean models are widely available and very popular.

You can research the range of vehicles available from websites like The Automobile Protection Association’s. The Lemon Aid Guide is a type of consumer reports book on vehicles in Canada, from older to newer models. The reports include details on owner related problems, technical service bulletins, depreciation and used price guides. The books are are sold online, through bookstores and available to borrow from many libraries in Canada. This book is quite an eye opener to the intrepid car buyer. This is a must read for anyone looking to buy a new or used vehicle.

Other useful sites include the American reports at Kellys Blue Book and

Buying from a dealer

The pros and cons of buying from a main dealer, a used car lot or privately are the same in Canada as they are in the UK. Watch out for the 30 second or 30 yards warranty from the less reputable used car lots. Once you pass either the car is yours.

Main dealers sell and lease new and used cars. Car dealers are the same the world over. Though you can expect a friendly and professional approach from the sales staff you should go into the showroom with your eyes open and your brain switched on. You are dealing with trained and expert negotiators whose objective is to maximize their revenues – and that means getting as much money out of you as possible.

Their aim is sell you a vehicle as near to the sticker price as possible. There is virtually always something you can negotiate off this price. However, it’s up to you to get it. The negotiation starts when they say, “this is the MRRP of the car – make me an offer”. The only way you will know the right amount to offer them is if you know how much it cost them. There is a website called Car Cost Canada where for $40 you can buy an online report listing the dealer cost of up to 5 comparable models.

Car Buying Tips is an informative, if long, read of what to expect from car salesmen and how to deal with them. It's a US site, edited of Canadian content, but if you are buying from a dealer you really should read through the chapters listed at the bottom of the page.

Buying a used car

A used vehicle can be a sensible purchase. Unless you absolutely positively need a new set of wheels or have this obession with 'automotive virginity' or have money to throw away, a used car is often the way to go. Pick something 3 to 4 years old, with 50,000 kms on the meter, have it rust-proofed every year in central and eastern canada, and then drive it into the ground. A well maintained car can easily last 150,000 kms. And be thankful some people do buy new cars as it allows one to buy second hand. Whether you are buying privately or from a dealer, it is essential to have the car checked first by a competent mechanic. The provincial AAs offer this service for $120-$150 as do many car mechanics. Car dealers are used to this and will transport a used car to a mechanic for inspection. If they, or a private seller, will not allow an inspection it is probably best to walk away.

Used car prices can be investigated on websites such as

(other posters are invited to add to this list)

Autotrader has many listings of used vehicles. Also try Craig's List.

Some more information about buying and selling used cars is available here:

Used vehicles from the Lower Mainland of BC have the highest resale values because of the climate. The rest of Canada uses a lot of salt on the roads during the winter and this leads to rust problems earlier in the car’s life (not true of Alberta). One word of warning when buying a used vehicle is to watch out for “curbers”. These are car dealers who pose as private individuals. One of their favorite ways of making money is to buy used cars from auction in Ontario, transport them to BC, and sell them as though they are their own family cars. A car history report (ICBC do these from $20-$60) is a worthwhile investment.

It would be VERY wise to purchase a CarProof report on any used vehicle. This is similar to a [] report, but much more relevant to Canadian vehicles versus American vehicles. This report is available online at [] and generally contains much more information than a carfax report. You will need the VIN (Vehicle Identification Number) to order one. This is useful in that it is a real time report and will tell you if the vehicle has been reported stolen or has a lien against it. An outstanding Lien means that someone has a financial interest in the vehicle and it is subject to potential repossesion. If you order the "B.C Verified" version (most expensive) it will give Canada wide information on the vehicle from many sources; including insurance and accident history, registration history and provincial registry (liens) as well as police (stolen) records and even US information should the vehicle ever have been registered south of the border.

Beware of scams in private ads (there are many on kijiji, Craigslist and Canada Trader). Vehicles offered at "too good to be true" prices are usually scams. Another classic scam, is when the 'owner' tells you the car is currently in another location far away, but if you send money.....etc, etc. If you come across any of these - RUN the other way. The old caveat "If it sounds too good to be true, it probably is" applies. It's very much Caveat Emptor (buyer beware) here in Canada.

A good source for used car prices specific to Canada, is the Canadian Black Book. You can register online at the CAA (like the AA/RAC in UK) and from there you can access this service. You will need to know the make/model/mileage and it will give an average trade in value that a dealer would pay you for your used car on trade, and also an average retail value that you would pay for a used car on the lot at a dealership. The down side with dealership shopping is that you will pay GST/PST even on a used vehicle, whereas with a private sale you won't. A useful tip though - even for those not comfortable with negotiating on price and given that the car is priced reasonably, is to offer the 'sticker price' inclusive of GST. This 'usually' works quite well.

There is also a Government surplus website that has used cars for sale:

Car brokers

Some posters have saved themselves the time and effort of searching for a vehicle by using the services of a car broker. Greg Huynh at has been recommended by one poster.

Related Wiki articles

Block Heaters


Winter Driving

Drivers Licence Canada

Related Forum Posts

There is an excellent post here in the Canada forum giving plenty of advice for buying either a new or used car.