Luxury tax on yachts, cars and personal aircraft comes into effect on January 1, 2022. The tax would be applied on the following:
🚙🛩🚁Cars and personal aircraft over $100,000
⛵️Boats for personal use over $250,000.
The tax is calculated at the lesser of: 20 % above
👉🏻$100,000 for cars and personal aircraft
👉🏻 $250,000 for boats)
10 % full value of the luxury car, boat or personal aircraft
📍HST is charged on the amount that INCLUDES the Luxury Tax.
📍To be charged by vendor at point of sale
📍Applies to imports
📍Applies to leases
📍Exports are excluded
Example: Car costs $150,000. Luxury tax calculation:
1. 20% x($150,000-$100,000) = $10,000
2. 10%x $150,000 = $15,000
Luxury tax $10,000 plus HST The tax would affect
📌New passenger vehicles including sports cars, coupes, sedans, station wagons, SUVs, passenger pick-up trucks, and passenger vans and minivans that seat less than 10 people.
📌Motorcycles and certain off-road vehicles such as ATVs and snowmobiles, racing cars (used solely for on-track or off-road racing)
📌New aircraft affected include airplanes, helicopters and gliders.
Exemptions are for:
📌Motorcycles and certain off-road vehicles such as ATVs and snowmobiles, racing cars (used solely for on-track or off-road racing) and RVs.
📌Off-road, construction and farm vehicles,trucks, cargo vans,buses, police cars, ambulances, and hearses.
📌Smaller personal watercraft, such as water scooters
📌Cruise ships, ferries, commercial fishing vessels and floating homes
#taxadvice #taxsavings Purchase yachts, cars and personal aircraft described above prior to January 1, 2022.