Trade-in or private sale: which pays more after tax?

A trade-in at a dealer lowers the sales tax on your next car, so it is worth more than its price. In Ontario a $10,000 trade-in saves $1,300 in HST, and in Quebec it saves $1,497.50 in GST and QST. Enter your offers to see which option leaves you the most after tax and selling costs.

What each option leaves you

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Why is a trade-in worth more than its price?

When you trade in at a dealer, the sales tax on your next car is charged on the price minus your trade-in. That saving is money in your pocket that a private sale doesn't give you.

Province	Saved per $10,000 trade-in
Newfoundland and Labrador	$1,500
Nova Scotia	$1,400
Prince Edward Island	$1,500
New Brunswick	$1,500
Quebec	$1,497.50
Ontario	$1,300
Manitoba	$1,200
Saskatchewan	$1,100
Alberta	$500
British Columbia	$1,200
Northwest Territories	$500
Yukon	$500
Nunavut	$500

What does a private sale really cost?

Your time, ads, cleaning, showing the car to strangers, and checking that the payment is real. In Ontario you must give the buyer a Used Vehicle Information Package ($20). The buyer pays sales tax when they register the car, which is why private buyers often push the price down.

When does a private sale win?

When your private price beats your trade-in plus the tax saving plus your selling costs, or when you aren't buying your next car from a dealer, since then there is no tax saving.

Frequently asked questions

Do I pay tax when I sell my car privately?

No. In a private sale the buyer pays the tax when they register the car. You pay nothing on the sale itself.

Does the trade-in tax saving apply in every province?

Yes, when you buy from a registered dealer. In Alberta and the territories it covers only the 5% GST. In British Columbia and Saskatchewan the car you trade must have had provincial tax paid on it.

What if my next car costs less than my trade-in?

The saving only applies up to the price of the next car. Enter that price and the calculator caps the saving.

Tax rules checked on October 6, 2026. Sources:

Estimates for information only, not tax or financial advice. Confirm the numbers with your dealer or lender.