Getting a car is a big step and a huge quality-of-life change, and it is important to understand what car ownership means, and how it transfers when we sell or gift it.
What does Vehicle Ownership mean in Ontario?
This is the green document you receive once your vehicle transfer process is completed. This permit is used as proof of vehicle ownership. This includes information such as The VIN (Vehicle Identification Number), make and model of the car, the name and address of the car owner, and the license plate number and sticker expiration.
How important is this permit?
You are legally required to carry this permit at all times while driving. This document is especially important when making insurance claims as the compensation goes to the person listed as the owner of the vehicle. Further, the prior owner holds the legal liability for the vehicle until it is completely processed by the buyer at Service Ontario.
Can a car be registered under two names in Ontario?
Yes, joint ownership of a vehicle is possible! The two parties can be family, friends or colleagues. In this, both names will be used on the permit and on any other paperwork, such as the transfer of ownership.
Gifting a vehicle to a family member?
The ownership can be transferred between eligible family members without paying Retail Sales Tax or RST in Ontario. For this, the following information needs to be provided to Service Ontario:
- Proof of vehicle insurance
- Driver’s License
- Vehicle Ownership Permit (the green document we were talking about earlier)
- Plate transfer declaration
- This completed form for Sworn Statement for a Family Gift of a Used Motor Vehicle in the Province of Ontario
- Safety Standards Certificate if transferring to family other than spouse
- Emissions test results
Are you purchasing a used vehicle?
Before settling on terms and signing that deal, make sure you’ve checked the vehicle’s history, emissions records, authorisation of ownership, debt record, and visual features. Unfortunately, scams exist in the business. We have to be cautious to not fall for it.
To transfer the ownership, ensure that you
- Check the VIN on the vehicle matches the one on the owner’s permit
- Complete the Application for Transfer
- Register the car within 6 days of purchase
- Pay the retail sales tax, licensing fees for the plates, permit, and sticker
- Fill out the Bill of Sale section within the Used Vehicle Information Package
- Show proof of car insurance
- Further, the seller should give you:
- the completed vehicle portion of the owner’s permit
- the Used Vehicle Information Package with the bill of sale specifying name of the seller and purchase price
Are you selling a used vehicle?
As a seller, you must
- Provide a Used Vehicle Information Package to the buyer
- Complete and sign the Bill of Sale along with the buyer by filling out the
- name and date
- the buyer’s name and address
- purchase price
- Complete and sign the Application for Transfer, found under the vehicle portion on the back of the ownership permit
- Retain the license plate so that you
- don’t get charged for parking or speeding tickets by the buyer`
- can register your plates on other vehicles
- request a refund for unused full months on your plate stickers
- Notify Ministry of Transport that your vehicle is sold
- Obtain a safety standards certificate from a licensed mechanic
What will it cost me?
After determining the value of the used vehicle, Service Canada charges $32 for car ownership. The sales tax is 13% of RST in Ontario (with some exemptions), levied on the higher purchase price or the vehicle’s wholesale value. It is paid by the buyer to the government and not to the seller.
Now that you know how to transfer ownership, learn more about obtaining car insurance in Ontario.