Gift of imported car allowed once a year within family

Eric Lai

SPECIAL TO THE STAR

Q: My daughter attends university in the United States. I need a new vehicle and the pricing there is still a lot lower than in Canada.

Can I purchase a vehicle in the U.S. in my daughter’s name, have her drive it back to Canada, and then give it to me as a gift to avoid paying tax on the ownership change since it is a family gift?

I am told that my daughter is allowed to give a gift within family once.

A: The vehicle owner, whether your daughter or yourself, would have to go through the process of importing the auto into Canada, which includes paying applicable taxes and making required safety modifications, before it can be registered here.

Once lawfully imported, the ownership may be transferred tax-free between family members. Only one tax-free transfer per vehicle is allowed every 12 months within your close family.

Canadians considering buying an auto south of the border should note that some U.S. dealerships may refuse to sell to non-U.S. residents.

For additional information, contact the Registrar of Imported Vehicles (www.riv.ca or 1-888-848-8240) and the Ontario Ministry of Transportation (www.mto.gov.on.ca or 416-235-2999 or toll-free at 1-800-387-3445).

Cameron Gray, spokesperson for the Registrar of Imported Vehicles, adds:

On the www.riv.ca website, please check the vehicle admissibility list to ensure that the vehicle is eligible for import into Canada. You can also click on “cost considerations” to learn about possible costs associated with the importation process.

Contact the Canada Border Services Agency to determine if there are any duties and/or taxes applicable at 1-800-461-9999 (within Canada) or 506-636-5064 (outside Canada).

Q: I am purchasing a new car from a dealer without financing. I’d like to pay for it with a certified cheque for $20,000 and by credit card for the balance of about $12,000.

Would this be acceptable to most dealers?

A: Mohamed Bouchama, executive director of Car Help Canada (carhelpcanada.com), a non-profit consumer group that assists members with automotive purchasing as well as resolving disputes with dealers, extended warranty companies and repair shops, replies:

In our experience, we find the majority of dealers will not accept a high payment amount by credit card. In general, the maximum they will accept is around $3,000.

Eric Lai adds:

While consumers benefit from rewards points, cash-back or other loyalty programs offered by the credit card companies, it’s important to keep in mind that the retailer accepting the credit card payment is the one that pays for that benefit.

Credit card issuers deduct a percentage fee from the total sale amount when reimbursing the retailer, so the higher the amount billed, the higher the fee incurred. For example, on a $12,000 purchase, even a 2 per cent fee would represent a $240 cost to the retailer.

If a separate loyalty card is also used on the purchase, the retailer may incur an additional fee.

In turn, it’s the consumer that ultimately pays for loyalty program rewards, as retailers must increase prices to cover these additional costs.

Natural gas fuel economy update: How much do you really save on fuel with a natural gas vehicle? After two months of driving my new-to-me 2001 F-150 factory natural gas pickup with a 5.4-litre, V8 engine, I can report that the best mileage incurred was $6.50 per 100 km on an all-highway round trip to Guelph. However, routine stop-and-go city driving averages about $11 to $13 per 100 km. So, ultimately, I’m driving a large pickup truck hauling heavy cargo, but only paying the equivalent fuel costs as a mid-size gasoline automobile. And that’s just fine by me.

You can send your non-mechanical questions to Eric Lai at wheels@thestar.ca. Include year, make, model and kilometres of autos cited, plus your name, address and telephone number. Personal replies cannot be handled due to volume.

More videos from Wheels.ca and our partners