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Mad Multi · 15-02-2021, 11:47

Im a Canadian living in Canada but plan on moving aboard this spring and floating around the world for a few years. my question is if I buy a boat in Canada can I not register it take it out of the country and register it elsewhere so I do not pay canadian taxes?

I'm assuming I can get away with this so the next question is where should I register and can I do that online?

Mirage35 · 15-02-2021, 11:52

A search should find a bunch of threads on this, but the short answer is: if you buy the boat in Canada and keep it in Canada, or if you buy it somewhere else and bring it into Canada, you pay Canadian taxes.

Mike OReilly · 15-02-2021, 11:58

Registration is not related to taxes. But a boat must be licensed or registered.

My understanding is that if the boat is in Canada, or is imported into Canada, then taxes are due. I think the only way you could get away with this tax avoidance scheme is if you took possession of the boat outside of Canadian waters, and didn't bring it back.

SVNagambie · 19-06-2021, 15:09

If you buy the boat in Canada, or if you buy it outside Canada but bring it in to Canadian waters, as a Canadian resident, you will have to pay tax. It does not matter where the boat is registered.

I was once told by a dealer that if you purchase a second-hand boat privately in a ananda there is no tax payable. Only if purchased from a brokerage. You might want to check that out.

Quote:

Originally Posted by Mad Multi

Im a Canadian living in Canada but plan on moving aboard this spring and floating around the world for a few years. my question is if I buy a boat in Canada can I not register it take it out of the country and register it elsewhere so I do not pay canadian taxes?

I'm assuming I can get away with this so the next question is where should I register and can I do that online?

chris mac · 20-06-2021, 07:10

We bought a canadian registered boat in canada. (We are canadian) we also registered it as Canadian. Transport Canada has full knowledge of, and all the info regarding our purchase.
No taxes were requested or payed. We bought thru a private sale(no broker) in 2019

boatpoker · 20-06-2021, 07:52

Quote:

Originally Posted by chris mac

We bought a canadian registered boat in canada. (We are canadian) we also registered it as Canadian. Transport Canada has full knowledge of, and all the info regarding our purchase.
No taxes were requested or payed. We bought thru a private sale(no broker) in 2019

Yup ! Transport Canada does not report to Revenue Canada when you register a boat. Occassionally Rev Can does spot check Trans Can records and it is very expensive if they catch you. It is the buyers responsibility to report the purchase to Rev Can and voluntarily pay the taxes.

I know one vessel that was siezed, one fella with a heavy fine and penalties (caught 6yrs. later) and one fella that was arrested by the RCMP for tax evasion.

I am familiar with these cases as I'm a Transport Canada Appointed Tonnage Measurer and was involved in these three deals.

pcmm · 20-06-2021, 08:00

Quote:

Originally Posted by SVNagambie

If you buy the boat in Canada, or if you buy it outside Canada but bring it in to Canadian waters, as a Canadian resident, you will have to pay tax. It does not matter where the boat is registered.

I was once told by a dealer that if you purchase a second-hand boat privately in a ananda there is no tax payable. Only if purchased from a brokerage. You might want to check that out.

Buying privately you still have to pay tax. When you get it licensed you have to show proof that tax was paid. If not they’ll just bill you for it.

Been there done that. Some times it takes them a while (3 years for me last time).

nmuir · 20-06-2021, 08:13

Back to the OP.
The difference is buying the boat in Canada or not.
I acknowledge it is not what you outline, but if you buy a boat outside of Canada it can be registered as a Canadian boat with no tax due until it comes into the country.

Lake-Effect · 20-06-2021, 08:50

Quote:

Originally Posted by nmuir

Back to the OP.
The difference is buying the boat in Canada or not.
I acknowledge it is not what you outline, but if you buy a boat outside of Canada it can be registered as a Canadian boat with no tax due until it comes into the country.

This sounds like the most reasonable answer. I have heard that the government is getting a bit more serious about chasing owed tax, so chris mac, you may yet get a bill...

Mike OReilly · 20-06-2021, 09:05

Quote:

Originally Posted by boatpoker

Yup ! Transport Canada does not report to Revenue Canada when you register a boat. Occassionally Rev Can does spot check Trans Can records and it is very expensive if they catch you. It is the buyers responsibility to report the purchase to Rev Can and voluntarily pay the taxes.

I know one vessel that was siezed, one fella with a heavy fine and penalties (caught 6yrs. later) and one fella that was arrested by the RCMP for tax evasion.

I am familiar with these cases as I'm a Transport Canada Appointed Tonnage Measurer and was involved in these three deals.

This is my understanding as well; that sales taxes are owed on private boat sales. But I do know a lot of people seem to avoid paying with no issues.

My previous boat was a private sale, bought in Ontario. When I licensed the boat (not registered) I was told I would be sent a bill for the sales tax owed. I bought my current boat in the USA. As soon as I hit the border I had to import the boat, which really just meant ponying up the sales tax.

boatpoker · 20-06-2021, 09:24

Quote:

Originally Posted by nmuir

Back to the OP.
The difference is buying the boat in Canada or not.
I acknowledge it is not what you outline, but if you buy a boat outside of Canada it can be registered as a Canadian boat with no tax due until it comes into the country.

We get involved in cross border dealings frequently with deliveries and Tonnage Measurements ... You are correct.

**TrentePieds** · 20-06-2021, 09:41

Mad Multi:

Why would you ask a question like that here? The regulations regarding tax liability are very complex and AFAIK none of us, here on CF, is a Canadian tax expert. I have been away from it for so long that what I know is probably not trustworthy any more!

Canada's tax regime requires self-reporting. The consequences if you DON'T report, and they find your transaction in a random check - which the do perform - can be very costly! Let alone if someone "snitches" on you. That does happen!

So get your information straight from the horses mouth! Not from us naïfs :-)! Here are the current regulations for the Province of BC.

https://www2.gov.bc.ca/assets/gov/ta...-108-boats.pdf

Regulations differ from province to province. So ask the all-knowing Ms. Google to find you the regs for the relevant province. Then read them. Then read them again to understand them. Then be guided by them! And remember that the regs that apply to a transaction are those for the province where the transaction takes place - not where you reside.

Tax AVOIDANCE is the arranging of your affairs so as to minimize tax liability WITHIN the law and regulations. That is encouraged by the authorities both federally and provincially. Tax EVASION is the ignoring of the law and regulations even if it happens out of naivety. Tax evasion is a criminal offense.

So mind how you go :-)!

TrentePieds

Gulliverus · 22-01-2022, 09:58

I read somewhere that the government estimates that the new tax will bring about $500 million to the treasury over the next five years.

boatpoker · 22-01-2022, 10:07

Quote:

Originally Posted by Gulliverus

I read somewhere that the government estimates that the new tax will bring about $500 million to the treasury over the next five years.

BDO - "In its 2021 Budget, the federal government proposed to introduce a tax on the sale of certain luxury goods purchased for personal use such as cars, boats, and aircraft. The tax would apply to new cars and aircraft with a retail sales price over $100,000 and to boats over $250,000. The tax would be calculated at the lesser of 20% of the value above the threshold ($100,000 for cars and personal aircraft, $250,000 for boats) or 10% of the full value of the luxury car, boat, or personal aircraft."

pcmm · 22-01-2022, 10:09

Quote:

Originally Posted by boatpoker

BDO - "In its 2021 Budget, the federal government proposed to introduce a tax on the sale of certain luxury goods purchased for personal use such as cars, boats, and aircraft. The tax would apply to new cars and aircraft with a retail sales price over $100,000 and to boats over $250,000. The tax would be calculated at the lesser of 20% of the value above the threshold ($100,000 for cars and personal aircraft, $250,000 for boats) or 10% of the full value of the luxury car, boat, or personal aircraft."

Good way to put a damper on an industry!