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Guide 03 · trade

A trade value should never disguise the vehicle price.

Treat the purchase and the trade as connected calculations with separate evidence. That makes it much harder for one flattering number to hide another.

Last reviewed July 23, 2026. Educational information, not legal, tax, or financial advice. Confirm the signed contract and current rules before acting.

Keep five numbers visible

  • the new vehicle’s all-in selling price;
  • the dealer’s trade allowance;
  • any lien payout;
  • the stated tax treatment; and
  • the resulting net changeover.

Marketplace trade bids are optional and remain conditional on physical inspection. The dealer must state the conditions and expiry instead of treating a preliminary estimate as unconditional.

Tax treatment depends on the facts

CRA guidance says trade-in GST/HST treatment depends on whether the person trading the vehicle must charge tax and whether the new transaction is a sale or lease. Ask the dealer to show the calculation that applies to your situation, and obtain tax advice when the vehicle is a business asset.

Bring evidence to inspection

Have ownership details, lien information, service records, keys, accessories, mileage, and known condition issues ready. Record material inspection changes in writing before accepting a revised net changeover.