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The Used Car Dealers Association of Ontario

416-231-2600 or 1-800-268-2598 or fax 416-232-0775

Used Car Dealers Association of Ontario   

Frequently Asked Questions about Status Indians and HST

1. When is a sale or lease of a motor vehicle to a Status Indian exempt from HST?

Status Indians, with a Certificate of Indian Status issued by the Indigenous and Northern Affairs Canada, are exempt from HST where they purchase or lease a vehicle and take delivery of the vehicle on a Reserve. It does not matter whether they live on the Reserve. So, vehicles sold or leased to a Status Indian and delivered to the Status Indian on a Reserve are exempt from the full 13% HST.

Delivery off Reserve

Sales or leases to Status Indians with delivery off Reserve will be exempt at the point of sale from the 8% provincial portion of HST, meaning that dealers should charge only 5% GST if the Status Indian takes delivery off-Reserve.

2. What if a Status Indian purchases parts from a dealer?

The same rules as in Question 1 apply. Parts sold and delivered to a Status Indian on Reserve are fully exempt from HST.
Parts sold to a Status Indian will be exempt from the 8% provincial portion of HST and subject only to 5% GST.

3. What if a Status Indian has repairs performed at a dealer?

Repairs performed for a Status Indian at a dealership are subject only to 5% GST.

4. Other than a Certificate of Indian Status Card, are any other cards or identification acceptable as proof of Indian Status?

The Indigenous and Northern Affairs Canada issues a Temporary Confirmation of Registration Document to individuals who have been newly registered as Status Indians. The document confirms that the individual named on the document is registered as a Status Indian under the Indian Act.

A sample can be viewed here.

The document must be on Indigenous and Northern Affairs Canada letterhead with a red Canada logo and include a raised seal of the Indian Registrar at the bottom right. The document is not valid after the expiry date shown.

Dealers should only accept an original document from the individual.... not a photocopy. Dealers should make a copy of the document and the photo ID and keep them on file.

Other non-government cards, such as “M├ętis” cards, “First Nations”cards “Aboriginal Nation” cards do not entitle the cardholder to any tax exemption.

5. What evidence is acceptable to show that a Status Indian took delivery on a Reserve?

If audited, you may be asked for documentation as evidence that the Status Indian took delivery on a Reserve. The UCDA recommends that you:

  1. Purchase something such as gas on a Reserve and get a dated receipt, showing the date and address
  2. Take a photo of the vehicle beside a recognizable landmark on the Reserve, such as a store, the band office or Reserve sign
  3. Log the distance driven between the dealership and the Reserve address

6. 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.

7. What if two people are buying or leasing a vehicle, but only one is a Status Indian?

This often arises because the transaction involves financing or credit and the Status Indian has to have a co-signor (often his or her spouse who may not be a Status Indian) sign the contract. If a Status Indian is a purchaser or lessee on the contract, the transaction is exempt from HST as long as the vehicle is delivered to the purchaser or lessee on a Reserve. It doesn’t matter whether the co-signer’s name is shown on the registration or not.

Where a vehicle is registered, showing both a Status Indian and non-Status person as co-registrants, the transaction is HST exempt, as long as the Status Indian is also shown as the purchaser on the bill of sale and takes delivery on Reserve.

8. 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 type of vehicle, equipment or machinery sold to a Status Indian.

See what all four different Certificate of Indian Status Cards look like here.