Taxes on cars from AB
 

So I have a friend who took a new offer in Alberta for an executive position as no one in his company wants to relocate for an unproven new venture. :fuckthatshit:

The offer is for a minimum 2yr contract. And given the HUGE tax difference on exotic cars, my friend is looking to purchase one while there, and ultimately bring it back to BC if he can find a better position once the contract is up.

A quick reading on ICBC, cars from outside of BC is subject to a depreciation scheme as far as PST is concerned. 30% reduction for every year.

Thus, the question is how's that 30% calculated? Is it from the sales price (minus GST) of the original sale or something ICBC has internally? And there's our infamous luxury tax on vehicles, how would the calculation work out?

The idea is to buy something exotic in the 250k-300k range. And let's say it's 2yr sharp with 300k car... so the valuation for PST consideration is 300k*0.4=120k.

But the taxation table is a mess as far as PST is concerned and we can't quite collectively figure it out even after reading the ICBC Bulletin.

Does anyone have experience car to share what PST rate he'd be subjected? Is it 12% or 10% ("imported into Canada")? Or is it 20%? (based on the original 300k sales price)

He's there by himself for the first few months while the family is still in BC (if that makes any difference) and depending on how he feels, he'd decide whether to move the kids or not... but chances are, kids will stay in BC as they are in a quite decent private school and they aren't willing to give up the spots.

I bought my Camaro SS 1LE in Edmonton in May and then brought it back to BC in September. When I got the paperwork done, I just had to pay for the new license plates(plus switch the insurance). They told me the PST is waived if you owned the vehicle for more than 30 days in Alberta.

Mine isn't a luxury car, but that's still a few grands in tax revenue if they want to collect tax.

That's the most recent experience, anyway. Do you have any link I can look at on what you are talking about? My Google-fu isn't returning anything.

So he's basically trying to "save" on the luxury tax. Word of advice, keep the car on Alberta plates.

Is he remaining a resident of BC? Or will he change everything over to Alberta (health care card, drivers license, etc).

If he changes his official residence to Alberta, on return, he will pay no tax under the New West Partnership Trade Agreement .

See page 8: exemptions.
https://www2.gov.bc.ca/assets/gov/ta...8-vehicles.pdf

and

https://www2.gov.bc.ca/assets/gov/ta...-residents.pdf


and if he plans on maintaining his residence as a BC resident I believe it is 10% he would pay.

He’s AB resident now (as in he’s just got his AB license after he moved there).

But given that the whole family is in bc, he doubts the move being permanent. So the idea is to ultimately move back to bc after contract is up and career advancement opportunity opens up.

Keep it in Alberta until the value in ICBCs eyes depreciates to the price he finds acceptable?

OK. So if he has officially declared that he is now an Albertan, no PST on his move back with the car. Am I missing something here?

Yep. I guess that’s indeed the case. Time to save 60k :fuckthatshit:

Maybe I'm retarded today and can't think these days. So he plans to buy a new car which he will pay taxes on in AB. When he moves back to BC, doesn't add up if he pays tax again to switch to BC plate...It's like tax on tax...

Your friend may be an Alberta resident but may need to consider his family situation. It won't be an issue if "family" are parents, brother, sister. But family being wife, kids would imply he still is connected to BC.

He's an AB resident now as he has the residence (rented by the company) with AB license and healthcare. So the idea is to buy an exotic car in the 250-300k range.

Doing that in AB is 300k*1.05=315k out the door.

The same car in BC would cost 300k*1.25=375k OTD.

From what nismodrifter provided, he'd be exempt of BC PST when he brings the car back to BC. What he'd have to double-check would be if he'd be deem as "new resident" upon returning in 2yrs since his family are still here.

The car would initially have AB plates. But ultimately, when he returns to BC, he'd still have to bring it back and get BC driver's license again. So, I'm not sure how he'd be able to keep the AB plate (also AB insurance) if he no longer have residence there.

He would not keep the plate when he moves back as he no longer has anything to do with Alberta.

There is a bc government tax line which answers questions like these. I phoned them as I was in a unique situation when I moved here. I will find the number when I have a second. They were super helpful and picked up on the first ring (unheard of in this day and age with any govt agency). Need to ask re the implications of his family still being here.

I believe Alberta doesn't have any sales tax, nor luxury tax on cars, so the only tax he would be paying over there is the 5% GST (or do they call it the HST?).

Wow just 30 days! Did you have an AB license and AB residence?

When is he planning to buy the car? If he's getting it now it doesn't matter either way, and if he's getting it just before the contract ends it doesn't really matter what the rules are now as they could easily change by then.

I still had my BC driver's license but I did have a residence in AB at the time.

Not that they even asked about the driver's license.

He's already started shopping around. But before signing his autograph on the dotted line. It's a once in a lifetime thing... as he doubts he'd be buying another toy worth 6 figures again. And the saving is quite substantial... that's why he decided to pull the trigger.

I mean, if I were him, I'd do it too. With what he saves on luxury car tax, he could buy another car here... and not a bad one either.

If I were ever in the market for a Bugatti, I'd know what to do. :fuckthatshit:

I passed everything suggested here. Thx everyone for the replies.

@nismodrifter if you can find that number, that'd be awesome as we can get some official reply on this.

lol.... umm... if the 30 day thing is true...

man.. i would take a 2 month vacation in alberta, rent a place, chill for 60 days... change everything over... buy the car... plate it... drive it for a bit...

come back 40 to 60 days later.... change everything back to BC, plate it... profit?


There has to be a catch.... I mean... why do I still see alot of exotics with alberta plates if thats the case? Maybe just because they dont want to drill holes into the front bumper?

Yeah... that's exactly what I want to figure out.

Because it might not make sense for regular car. But as soon as you get into luxury car tax territory, which starts at 150k, that 20%, or minimum 30k can go a long way as far as vacay goes.

And if one is really into car collection, heck... it might even make sense to keep an AB home in the middle of nowhere for dirt cheap just to save on taxes.

My best guess is that if you own home in BC, they likely won't allow this, just like how one'd claim non-resident status for taxation when moving abroad.

As for the AB plates, I know a rich AF guy owns a "car rental" company in AB to hold all his cars... but the expense of going that route would only make sense if you are actively collecting and trading the cars constantly. For us regular folks who are just trying to fulfill a lifelong dream by buying one or two exotics, that's not feasible.

1 877 388-4440

Again, they were super helpful and had the answers to all my questions. Let us know what they say.

TIL: Reg guys dream of owning two 300k cars.

Back in the day $150k got you an exotic car. Now that's a service bill for an exotic car.

Haha... you might not be at that age group. But my friend is well into his 40s, and with kids college tuition on track, retirement saving plan on track... it's time to finally start doing something for himself. He's still very much a regular guy... hence he would care about the 20% he has to folk out if he were to buy the exotic in BC.

And not everyone would buy exotic cars... it's just my friend happens to want cars. I have friend/acquaintances who dropped 6 figures on watches, piano, camera gear... etc. Just to fulfill that "something". We all have our own thing. I'm sure one day you'd find yours too.

Ok. So I just called.

And the basic is this... based on today's legislation, if an AB resident (or anywhere outside of BC) is moving to BC and bringing his/her car, it's exempt from tax.

In my frd's case, since he is already an AB resident (he no longer has BC DL, MSP, and would be filling taxes as an AB resident for the next two years.

However, they "might" require additional information such home rental agreement, work agreement... etc to prove that it was a legitimate move.

My best take out of this is that for a regular car, one probably won't face any scrutiny. However, if you are bringing back a Ferrari or Bugatti, you better have all the evidence they can possibly require to prove that you didn't do such a thing for convenience/tax evasion.

Now... if one were to get a million dollar hyper car... :D