1. When is the sale or lease of a motor vehicle to a Status Indian exempt from PST
No PST is payable if the vehicle is:
a) sold to a Status Indian and the vehicle is registered in the purchaser’s name
to an address on a Reserve or;
b) leased to a Status Indian and both the plates and insurance are registered in
the name of the lessee to an address on a Reserve).
No PST is payable if a vehicle is sold or leased on or after September 12, 2006, to a Status Indian and delivered to them on a Reserve. See documentation requirements in Question 3. If the Status Indian takes delivery at your dealership, they must pay GST
2. When is the sale or lease of a motor vehicle to a Status Indian exempt from GST?
No GST is payable if the vehicle is sold or leased to a Status Indian and delivered to them on a Reserve. See documentation requirements in Question 3.
Return to top3. What documentation is required to confirm a tax exemption?
The purchaser or lessee shown on the bill of sale or lease agreement, must have
a Certificate of Indian Status Card issued by the Canadian government. The dealer
should record the person’s name, card number and “Band Number” from the card on
the front of the bill of sale or lease agreement and if possible make a photocopy
of both sides of the card.
To prove that delivery was made to a Reserve, dealers should purchase something
on the Reserve and get a dated receipt showing, the same date as the date of delivery,
and the address of the merchant. It’s also a good idea to keep a photo of the purchaser
taking delivery at a recognizable landmark on the Reserve, such as a sign with the
Reserve name on it.
It’s also a good idea to log the kilometers from the dealership to the Reserve where
delivery is made and have the customer sign an acknowledgment of delivery which
confirms the date and place of delivery and the vehicle (VIN, Year, Make and Model).
If the vehicle is shipped to a Reserve, keep a copy of the bill of lading showing
the delivery destination to be a Reserve address. The dealership, not the purchaser,
must be shown as the shipper on the bill of lading.
4. When is no tax payable at all?
If a vehicle is purchased or leased to a Status Indian and delivered to them on a Reserve, neither GST nor PST is payable (with applicable documentation as discussed in Question 3.)
Return to top5. Is it possible that a Status Indian may have to pay one or both taxes?
Yes. If a Status Indian purchases or leases a vehicle which is not registered (for leases not plated and insured) in their name at a Reserve address, and the vehicle is not delivered to them at a Reserve, both GST and PST are payable. Only GST is payable, if the vehicle is registered to a Status Indian on Reserve address, but is not delivered to the purchaser on a Reserve.
Return to top
6.(a) Is there any way for a sale to be PST exempt if a vehicle was sold
to a Status Indian prior to September 12, 2006?
Where a bill of sale is dated prior to September 12, 2006, PST would apply,
unless the vehicle was registered into the Status Indian’s name to a Reserve address.
6. (b) What about a lease entered into with a Status Indian prior to September
12, 2006?
In the case of a lease, there would be no PST if the plate and insurance
are both registered in the Status Indian’s name to a Reserve address. However, if
the plate and insurance are not registered to a Reserve address, but the vehicle
was delivered (with proper documentation as in Question 3) there will be no PST
on lease payments due after September 12, 2006. PST would still be applicable to
late payments, due prior to September 12, 2006 but not received until after that
date.
7. What if a Status Indian purchases parts?
The rules are different for GST and PST.
GST is payable on the sale of parts to a Status Indian, unless they are delivered
to a Reserve. See Question 3 for documentary requirements.
The sale of parts is exempt from PST, so long as the purchaser has a Certificate
of Indian Status Card. The person’s name, card number and “Band Number” on the card
must be recorded on the invoice and if possible make a photocopy of the front and
back of the card. Delivery of the parts to a Reserve is not required for the PST
exemption.
8. What if a Status Indian has service or repairs done to a vehicle?
Again, the GST and PST rules are different.
GST is payable where service or repairs are done to a vehicle for a Status Indian,
unless the work is done on a Reserve. See Question 3 for documentary requirements.
Service or repairs done for a Status Indian are exempt from PST, so long as the
customer has a Certificate of Indian Status Card. The person’s name, card number
and “Band Number” on the card must be recorded on the invoice and if possible make
a photocopy of the front and back of the card. The work does not need to be performed
on a Reserve for the PST exemption.
9. If PST was charged on a vehicle sold on or after September 12, 2006 to a Status Indian who does not live on Reserve and the vehicle was delivered to the purchaser on a Reserve (to obtain the GST exemption), can the PST collected be returned to the purchaser?
The Ministry of Finance has advised that, unless the sale is cancelled, dealers should not return PST they have collected. The purchaser can apply directly to the Ministry of Finance for a refund of the PST paid. They will need to prove that delivery took place on a Reserve. Call the UCDA for more information.
Return to top10. Do the registration and delivery exemptions also apply to ATV’s, snowmobiles and non-motorized vehicles, such as trailers?
Yes, these rules apply to any vehicle subject to registration with the Ontario Ministry of Transportation.
Return to top11. Other than the Certificate of Indian Status Card, are any cards or identification acceptable as proof of Indian Status?
No. Other cards, such as “Métis” cards and “Aboriginal Nation” cards do not entitle the cardholder to any tax exemption.
Return to top12. How can I confirm that an address is a Reserve address?
You can search Reserves by name on the internet here or call the UCDA for assistance.
Return to top