So… you just purchased a vehicle from a private sale in British Columbia. You got a good deal on the vehicle based on its condition but your new ride needs some work. You plan on taking the vehicle home and fixing it up. You head to your local auto insurance agency to register the vehicle and pay the PST on your purchase price. To your surprise, the PST owing is rather higher than you anticipated. The rules have changed. As of October 2022 the PST owing on a used vehicle purchased privately in BC is determined using the following rules:
- At the time of registration, the average wholesale value of the motor vehicle is determined using the Canadian Black Book valuation guide.
- If the average wholesale value of the motor vehicle is greater than the price paid for the motor vehicle, the average wholesale value is used for the purpose of calculating PST due.
- If, at the time of registration, a purchaser presents the Insurance Corporation of British Columbia (ICBC) with a completed Motor Vehicle Appraisal Form (FIN 320) and the appraised value and the price paid are both less than the average wholesale value of the motor vehicle, the value, for the purpose of calculating PST due, is the greater of the price paid or the appraised value.
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PST Saving Vehicle Valuation
You can choose to have your vehicle appraised independently if you believe it's dollar value is considerably less than the dollar value ICBC assessed it at. The assigned value ICBC uses is based on the Canadian Black Book average wholesale value. ICBC does not factor in the condition of the vehicle, or the repairs it needs to be road worthy. If you feel your vehicle is less than average you will likely benefit from an appraisal.
Vehicle conditions that may affect its average value.
· High odometer reading.
Higher than average mileage reading will reduce the vehicles dollar value.
· Exterior damage.
Large scratches, dents, rust, faded paint, missing paint, broken glass, missing parts, etc.
· Interior damage.
Torn seats, large stains, strong odors, broken or missing parts, etc.
· Mechanical condition.
Vehicle does not run, or runs poorly, missing parts, large fluid leaks, etc.
· Rebuilt status.