The $20 Document That Decides Your Tax Bill — and Whether the Car Is Even Yours
In Ontario the seller is required by law to hand it over. Most buyers do not know that.
In short
When you buy a used car privately in Ontario, the seller is legally required under the Highway Traffic Act to give you a Used Vehicle Information Package. Not providing one is an offence. It costs $20, and it is the seller’s $20.
Almost nobody knows this. Buyers turn up at ServiceOntario without a package, buy a second one themselves, and treat it as a fee they owed. They were being asked to pay for the seller’s obligation.
The package matters far more than its price. It carries the lien registered against the car, the full ownership and odometer history, whether the vehicle is on record as unfit or wrecked, and the wholesale value your 13 per cent tax is calculated on. A low number written on the bill of sale does not lower that tax.
What is inside, and why each line matters
Read in this order. The first row is the one that can cost you the whole car.
| What the package shows | Why it matters | What to do with it |
|---|---|---|
| Lien information | A lien claimant has a right to the vehicle or to the amount of the lien once the transfer completes | If a lien is registered, do not pay until it is discharged in writing |
| Registration history | Every present and previous owner, city of residence and odometer reading | Look for readings that move backwards, and for a string of short ownerships |
| Vehicle status | Whether it is registered as unfit, or reported as wrecked | Unfit means it needs a Safety Standards Certificate before it can be plated |
| Wholesale value | The minimum value Retail Sales Tax is applied to | Work out your real tax before agreeing a price |
| Vehicle details | Year, make, model, colour, body type, cylinders, power | Compare against the car in front of you, and against the VIN plate |
| Bill of sale section | Built into the package | Both parties sign and date it; you need it at the counter |
| Serial number and stub | Proves the package is an original | No stub, no transfer |
How the package decides your tax
This is the part that catches people at the counter. On a private sale in Ontario you pay 13 per cent Retail Sales Tax, and for a car, van or light truck it is charged on the greater of what you actually paid or the vehicle’s Red Book value.
So the familiar manoeuvre — a friendly seller writing “$1,500” on a bill of sale for a $6,000 car — saves nobody anything. ServiceOntario applies the higher figure. What it does achieve is a false document with your signature on it.
Two real exceptions exist. If the Red Book value is under $1,000, the purchase price is used. And if the car is excessively used or severely damaged and the Red Book value is $1,000 or more, you may have it appraised — but only by an OMVIC-registered dealer or an appraiser holding a Ministry of Finance appraiser number, and the appraisal must be completed within 60 days of purchase to support a refund. A friend’s opinion is not an appraisal.
When you do not need one
The requirement covers cars, vans, light trucks up to 2,200 kg empty weight, self-propelled motor homes, motorcycles and light farm vehicles. It does not apply to:
One detail worth holding on to: the family-gift exemption from tax is allowed only once on the same vehicle within a 12-month period. Passing a car through a relative to avoid tax twice does not work.
Order it before you need it
Ordered online, the package is mailed within five business days and can take up to ten more days to arrive. Bought in person at a ServiceOntario centre, it is issued the same day.
That gap is where the second $20 gets spent. A seller orders online on Friday, a buyer appears on Sunday, and somebody buys another package at a counter to get the deal done. If you are selling, order it the week you decide to sell, not the week someone wants to buy.
To order you need the VIN or plate number of the vehicle, plus your own Ontario driver’s licence number or registrant identification number, or your name and address.
Red flags
What to do next
Selling: order the package the week you list the car, not the week someone wants to buy it. Buying: ask for it before you view, read the lien line first, and work out the tax on the wholesale value before you negotiate.
Need an inspection, a safety certificate or bodywork before the sale? Compare automotive services in Ontario on Ontario24 and contact businesses directly. Ontario24 is a classified directory — we help you find and compare, and we do not vet anyone. Also useful: the Safety Standards Certificate and how to choose a mechanic.
Before you call anyone, it helps to know what this job should cost and what the next one will. What things cost in Ontario in 2026 puts 75 service prices in one table.
Frequently asked questions
$20, paid by Visa or Mastercard. Ordered online it is mailed within five business days with up to ten days of delivery time; bought in person at a ServiceOntario centre it is issued the same day. Those two timelines are the whole reason people end up paying twice.
The seller. Under the Highway Traffic Act the seller of a used car, van, light truck, motorcycle or motor home must give the buyer a used vehicle information package at the time of sale, and it is an offence not to. The buyer is not required to obtain it themselves, although they may.
Vehicle details, the full Ontario registration history with previous owners and odometer readings, any lien registered against the vehicle, the average wholesale value used for Retail Sales Tax, the last known status including whether the car is registered as unfit or reported as wrecked, and a bill of sale section.
Effectively, yes. Retail Sales Tax of 13 per cent is charged on the greater of what you paid or the vehicle’s Red Book value, so writing a low number on the bill of sale does not lower the bill. The package shows you that value before you agree a price rather than after.
Transfers between qualifying family members, purchases from a registered dealer, vehicles previously bought or sold outside Ontario, transfers between taxi licence holders, donations to a registered charity, and transfers to a hospital, municipality, school board, university or college. Heavy trucks, mopeds, boats and snow vehicles are also outside the requirement.
Damage. The package must be the original, the serial number unaltered, and the tear-off stub on page one still attached. A photocopy, a scan or a package with the stub removed will not work at the counter, and the transfer stops there.
The lien section first: a registered lien follows the car, not the seller. Then compare the odometer readings across the registration history for anything that moves backwards, and check the colour and body type against the car in front of you. Discrepancies are how stolen and re-vinned vehicles show themselves.
Sources and how current this is
Checked 18 September 2026. The $20 price, the contents of the package, the seller’s obligation under the Highway Traffic Act, the delivery timelines and the list of exemptions come from ServiceOntario’s used vehicle information package page, last updated 11 September 2026. The Retail Sales Tax rule — 13 per cent on the greater of purchase price or Red Book value, the $1,000 threshold, the appraisal route and the 60-day window — comes from the Ministry of Finance page on specified vehicles. Fees and rules change; confirm at source before a transaction. This is not tax or legal advice. Ontario24 is a classified directory and does not issue packages, register vehicles or collect tax.