Gift a motorcycle to me

[garyintoronto]

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Hi my birthday is upcoming and my roommates wanna gift his Yamaha R3 to me. Not a latest one, pretty old, but I can consider it as a my first practice bike.

I don’t know the value of that bike, maybe 2k-3k after checking Kijiji. Because it’s a gift, do I need pay for the tax? And how much should I paid when transferring ownship in service Ontario? I heard some story about 1 dollar thing, can I do that to avoid tax?

 

[Evoex]

Hi my birthday is upcoming and my roommates wanna gift his Yamaha R3 to me. Not a latest one, pretty old, but I can consider it as a my first practice bike.

I don’t know the value of that bike, maybe 2k-3k after checking Kijiji. Because it’s a gift, do I need pay for the tax? And how much should I paid when transferring ownship in service Ontario? I heard some story about 1 dollar thing, can I do that to avoid tax?

yes, only family member transfers get to skip the tax.

get your friend to write the amount you paid on the UVIP. be reasonable, if its a relatively new bike put a grand or two at least.

 

[Trials]

Must not be too old, they didn't even make that bike before 2015
Problem with a 'practice' street bike is that it's still a street bike and as such you are going to be paying just as much for insurance and license and plates and certification and repairs as the rest of us. The sales tax on a couple of grand is almost insignificant in the realm of motorcycle ownership, we are talking a whole 260$ here, that's a nice cheap motorcycle purchase that is going to cost you a couple of grand to insure over the next 1 year.

Congrats and best luck with your new motorcycle and learning to ride it

 

[Relax]

For cars, where the wholesale value is listed in the UVIP, they charge tax on the greater of the wholesale value or the actual price paid. For motorcycles, they don't list a value for some reason, so if your roommate truly gave it to you for free, then you should be able to put $0 or $1 as the price. Sometimes the person behind the counter may question it or ask you for an appraisal if they don't agree, but it's rare and you can just go to another Service Ontario and try again. The alternative, as mentioned above, is to get a bill of sale stating a price you can live with. The terms "no warranty", "as-is", "not running" and/or "missing parts" usually help to support a low price.

 

[GreyGhost]

If they question the value, they send the seller a letter asking how much they sold it for. It is not a registered letter. Most sellers never return that letter. You can put whatever value you want, the only things that get affected are the tax you pay and your morals. I like Relax' approach. He gave you a bike that needs work for a great price (I don't know if I've ever put less than $100 as it becomes awkward to justify why it was worth less than scrap).

 

[garyintoronto]

If they question the value, they send the seller a letter asking how much they sold it for. It is not a registered letter. Most sellers never return that letter. You can put whatever value you want, the only things that get affected are the tax you pay and your morals. I like Relax' approach. He gave you a bike that needs work for a great price (I don't know if I've ever put less than $100 as it becomes awkward to justify why it was worth less than scrap).

Have you seen people around you proceeded this gift thing before? just heard but never seen people did.

 

[GreyGhost]

Have you seen people around you proceeded this gift thing before? just heard but never seen people did.

I would not mention gift. That will cause confusion and roadblocks. There is an established process to gift vehicles to close relatives, what you are doing has nothing to do with that. Just buy it off him cheap.

 

[garyintoronto]

I would not mention gift. That will cause confusion and roadblocks. There is an established process to gift vehicles to close relatives, what you are doing has nothing to do with that. Just buy it off him cheap.

agree with you, they have a particular procedure for taxing gift, cheaper price maybe a reasonable choice.

 

[boyoboy]

write up for 1500$ seems reasonable

what a fantastic first bike

Read up on properly winterizing/storing your bike - failing to do so may leave you with a bike that won't start in the spring and needs work $ - just do it, now is the time. its simple stuff.

 

[matt365]

write up for 1500$ seems reasonable

what a fantastic first bike

Read up on properly winterizing/storing your bike - failing to do so may leave you with a bike that won't start in the spring and needs work $ - just do it, now is the time. its simple stuff.

If its legit a gift, they should both go to service ontario and swap it over for a buck.

No book price on a bike.

My last bike was $500... "as is" some assembly required...

Why pay out on taxes if they don't have to.

Sent from my SM-G903W using Tapatalk

 

[Klaatu]

For motorcycles, they don't list a value for some reason, so if your roommate truly gave it to you for free, then you should be able to put $0 or $1 as the price.

I got a 2 year old ZX14 from one of my best friends. I put down $1 on the selling price. I told her it was from one of my best friends. She said "you would not believe how many times this happens". So I assume it's pretty common. I never heard anything after, no letter, nothing. I think it's more common than we think, especially between friends.

 

[SVeezy]

I got a 2 year old ZX14 from one of my best friends. I put down $1 on the selling price. I told her it was from one of my best friends. She said "you would not believe how many times this happens". So I assume it's pretty common. I never heard anything after, no letter, nothing. I think it's more common than we think, especially between friends.

That’s a nice friend


Sent from my iPhone using GTAMotorcycle.com mobile app

 

[PaisaMed]

When the person at Service Ontario asks how much you paid for your motorcycle

 

[voyageur]

I got a 2 year old ZX14 from one of my best friends. I put down $1 on the selling price. I told her it was from one of my best friends. She said "you would not believe how many times this happens". So I assume it's pretty common. I never heard anything after, no letter, nothing. I think it's more common than we think, especially between friends.

I don't think there is a reason for govt/MTO/Service Ontario to track if that is what you mean by 'never heard anything'... Whatever taxes the govt earns on private sales of the used motorcycle is just profit if you ask me since the initial owner must have paid full taxes on the new bike when the person got it. I guess that is one way to look at it

I need a few of such good friends in my life lol

 

[PaisaMed]

You could tell Service Ontario that you built a deck for the seller and he paid you with his bike. Just sayin'

 

[Lightcycle]

You could tell Service Ontario that you built a deck for the seller and he paid you with his bike. Just sayin'

Probably not a good idea.

You've just admitted to the government that you've been paid-in-kind, and now you've involved CRA. This is what you have to declare as income:

from: Self employed Business, Professional, Commission, Farming, and Fishing Income: Chapter 2 – Income - Canada.ca

A payment in kind occurs when you receive or give goods or services instead of money. For instance, to pay someone for a business expense, you may give them something you produced on your farm instead of money. When you do this, include the FMV of the goods or services in income. Deduct the same amount as an expense.

If you received a payment in kind for a product you would normally have sold, include the FMV of the product in income.

Fair market value is normally the highest price, expressed in dollars, that property would bring in an open and unrestricted market, between a willing buyer and a willing seller who are both knowledgeable, informed, and prudent, and who are acting independently of each other.

And if you're not declaring this as income, now you're in tax-evasion territory...

All just to save sales tax on a motorcycle.

Income tax is what? ~33% of the highest value on the open market? Sales tax is 12% of any value you state?

Probably not worth it.

 

[PaisaMed]

^^^^^Yes, lightcycle, the wisdomful voice of reason!
Most service Ontario employees are not moonlighting as CRA enforcers and will simply assess HST based on the lower of what you tell them or the the wholesale value stated in the UVIP. In the case of motorcycle transactions, there are no retail or wholesale values in the UVIP package and this is where the creative accounting begins. On another note, as anyone ever received a letter from the MTO asking them to state what they recently sold their bike for?

 

[sid_for_speed]

Why not just say the bike needs repairs? It will at the minimum be required to pass safety to be put on the roads? Why not say it's a $100 transaction as the repairs needed are expensive and are being forked over by the new owner?

 

[GreyGhost]

Why not just say the bike needs repairs? It will at the minimum be required to pass safety to be put on the roads? Why not say it's a $100 transaction as the repairs needed are expensive and are being forked over by the new owner?

If I am writing up documents to sell a vehicle cheaply, they very clearly state as-is, where-is and if it's really cheap, "problems exist".

 

[timtune]

I had some old barn finds given to me. When I went to get the ownerships I explained they were given to me and I asked if $0 was going to raise any suspicion. She said it could and suggested $100. $13 in tax seemed like an easy price for piece of mind.
I have also been told by SO that they go by the value on the UVIP and if the UVIP has no value attached it's basically whatever you feel you can get away with. That info has saved big $s.

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