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Must GST be charge on sale or disposition of company vehicle?
Expert: Lloyd Lindsay
Arlene asked:
Do you have to charge GST on the sale or disposition of a company vehicle? The vehicle is listed as an asset and we have depreciated it each year since 2002. We are in Ontario.
Lloyd Lindsay answered:
IF YOUR COMPANY IS REGISTERED:
If registered, your company must charge the new HST at Ontario's 13 per cent rate.
IF YOUR COMPANY IS NOT REGISTERED:
If not registered, your company would not charge the HST. However, the purchaser will pay a 13 per cent Ontario Retail Sales Tax on the used vehicle when obtaining a license for the vehicle.
About the author
Lloyd Lindsay is a CA, a licensed Public Accountant, Chartered Professional Accountant, and a Certified Management Consultant. He completed the CICA In-Depth Tax Course in 1985 and has been in public practice for over 40 years. Also, from time to time, he teaches on a contract basis.
Lloyd is a member of the Personal Computer Club of Toronto and has hosted its Microsoft Office Special Interest Group for many years.
In addition to providing tax, accounting, and auditing services, Lloyd provides presentations on those topics and on using accounting software, PowerPoint, and MS Office programs.