Canada Car Import Tax Guide: Simplifying The Process

Registrar Of Imported Vehicles (RIV) Program

The Registrar Of Imported Vehicles (RIV) program is a regulatory framework. It ensures that imported vehicles meet Canada's safety and emission standards. If you're importing a car, here are the key steps to follow:

• Submit vehicle information. Complete the Vehicle Import Form (Form 1) through the RIV portal. This form collects essential details about your vehicle, including its make, model, year, Vehicle Identification Number (VIN), and compliance status. 
• Pay the RIV registration fee. You can initiate the import process by paying the registration fee online through the RIV website. 
• Complete a vehicle inspection. Get your vehicle inspected by an authorized RIV facility to ensure it complies with CMVSS and emissions regulations. 

By following these steps, you can ensure your imported vehicle meets all Canadian requirements. 

Emission Standards

Imported vehicles in Canada must meet strict emission standards, which align with the country's environmental goals, including the Paris Agreement. 

The Passenger Automobile and Light Truck Greenhouse Gas Emission Regulations outline these requirements, which aim to significantly reduce greenhouse gas emissions in transportation. 

Key Documents Required For Customs Clearance

Proper documentation is key. It ensures smooth customs clearance when importing a vehicle into Canada.

• Bill of sale. A document serving as proof of purchase, including the sale date, purchase price, and the buyer's and seller's signatures. 
• Original certificate of title. This document confirms vehicle ownership. It must clearly show the VIN. 
• Last registration copy (for used vehicles). The latest vehicle registration document from its origin. It shows the vehicle's registration and ownership history.
• United States-Mexico-Canada Agreement (USMCA) / Canada-United States-Mexico Agreement (CUSMA) Certificate of origin (if applicable). If the vehicle is a gift, a gifting letter accompanied by an appraisal document is required. 
• Form 1 - submitted to RIV. The Vehicle Import Form is submitted to the RIV. It's used to register the vehicle and obtain import clearance. 
• Form 2 - required for inspection. After submitting Form 1, the Transport Canada Vehicle Importation and Safety Compliance Form is sent. A Registered Importer (RI) completes it after the vehicle inspection.
• Salvage Certificate (if applicable). Necessary if the vehicle was previously salvaged or declared a total loss. 
• Recall Clearance Letter (for U.S. imports). A letter from the manufacturer confirms no outstanding recalls. It ensures the vehicle meets safety standards. 
• U.S. Customs Export Declaration. A completed declaration is submitted to the U.S. Customs and Border Protection (CBP) at least 72 hours before export. 
• Automated Export System (AES) / internal transaction number (ITN) Number for U.S. Exports. Documentation verifying the electronic export information filing. 

The paperwork is your vehicle's ticket to Canada. Every form, signature, and document is key to ensuring you meet Canadian import regulations seamlessly.

The RIV reviews your documents to ensure everything is in order. Once your vehicle passes inspection, the RIV issues a Canadian Certification of Registration. This certification lets you legally register and license your vehicle in Canada.

Incomplete documentation can cause problems at the border. Delays, penalties, or even denied entry are possible. Due to this, it's crucial to know the proper import process, particularly the car import tax Canada.

Import Duties, Taxes, And Costs For Cars 

Importing a car involves several costs, including duties, taxes, and additional fees that can vary by country. Understanding these expenses is key to avoiding surprises and ensuring a smooth import process. 

Prepare for various financial responsibilities when importing a car into Canada:

Import Duties

Under the North American Free Trade Agreement (NAFTA), vehicles made in the U.S. or Mexico are duty-free. Import taxes do not apply. However, if your car was built outside these countries, you'll need to pay an import duty of 6.1% of its value as listed on the bill of sale. 

Taxes

Like buying a vehicle in Canada, importing one requires you to pay GST, PST, and/or HST, depending on your territory or province. These taxes are calculated based on the vehicle's value at the time of import. 

RIV Fee

All vehicles imported into Canada, regardless of origin, are subject to a $195 RIV fee. This fee ensures compliance with Canadian safety and regulatory standards. 

Air Conditioning Tax

If your vehicle has air conditioning (as most do), you'll need to pay a $100 air conditioning tax.

Excess Weight Tax

Vehicles that weigh more than 2,007 kg (4,425 pounds) are subject to an additional excess weight tax. 

Fuel-Inefficient Vehicle Tax

Vehicles labeled "gas guzzlers" face an excise tax of $1,000 to $4,000. The tax amount depends on fuel inefficiency. It mainly applies to small passenger cars. 

Brokerage Fees

Hiring a customs broker can simplify the import process. Brokers handle tasks like preparing customs documents and coordinating border crossings. They submit paperwork and ensure duties and taxes are paid to Canada Customs. Their expertise makes the process easier. 

The total cost will depend on factors such as the car's value, country of origin, and final destination within Canada. 

Exemptions For Classic And Vintage Vehicles

Classic or vintage vehicles are usually over 15 years old. They are exempt from the CMVSS, which are outlined in the Motor Vehicle Safety Act (MVSA). 

These vehicles don't require compliance inspections. However, they must meet the Canada Border Services Agency (CBSA) admissibility criteria. This includes providing proof of the vehicle's age and undergoing a visual assessment at the border. 

Why Is Importing A Car From The U.S. The Best Choice?

Canada and the U.S. share more than just a border—they share a booming car trade. In 2022, the U.S. exported $57.5B in cars, with Canada's largest share at $16.9B (29.3%). This strong partnership highlights the high demand for U.S. vehicles in Canada, making it an excellent market for car imports.

Many Canadians choose to import cars from the U.S. due to several advantages:

• Affordable prices. Vehicle prices in the U.S. are usually lower than in Canada. However, car costs and exchange rates can affect this difference.
• Expanded selection. Importing vehicles gives access to models and features not available in Canada. 
• Broader access to the U.S. aftermarket options. The U.S. aftermarket industry offers a wide range of vehicle modifications.

Frequently Asked Questions

How much is the car import tax from Canada to US?

Typically, taxes and duties are applied when exporting vehicles. The duty rate is generally set at 2.5% of the vehicle's value but may vary based on the classification and trade agreements between Canada and the U.S.

How much is the car import tax from US to Canada?

For vehicles made outside the U.S., a 6.1% duty is applied. U.S.-manufactured cars are usually duty-free, but you'll still need to cover GST/HST, RIV payments, and inspection fees.

Is it okay to use a Canada car import tax calculator?

A tax calculator can help estimate duties, taxes, and fees. However, to avoid discrepancies, always verify the specifics with Canadian customs.

Driving Into Canada: Make Your Car Import Journey Smooth And Successful

Importing a car to Canada offers cost savings, vehicle variety, and customization opportunities. However, the process requires understanding safety standards, emission regulations, detailed paperwork, and the Canada car import tax. Understanding the requirements is essential, whether it's a modern U.S. car or a vintage treasure. Stay informed for a smooth car import experience.