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New Canadian RV 10

BrianP

Member
Hi guys. I’m new to this forum. My son and I are ordering an RV 10 kit. Just wondering if there are any Canadians here that have ordered a kit recently and have any info on the new luxury tax on airplanes. Does it apply to these kit planes?
 
Not for the kits themselves as they aren't over $100k.
I don't know what might be in store for you when it comes time to register your plane and TC possibly relays that on to Revenue Canada & maybe then they allot some sort of value to the finished plane. Maybe then, you might be assessed LT to the value over the $100k...
Maybe you should try contacting COPA and see if they have any read on what will be.

Lots of maybe's
 
Ambiguous Legislation

Guidance on this can be found at:
https://www.canada.ca/en/revenue-ag...ect-aircraft-select-luxury-items-tax-act.html

Take a look at the applicability section and it appears to only be triggered by a sale, importation, lease or improvement.

About halfway down, there is a section on improvements but it does not appear to apply to building an aircraft.

I am sure that if this is presently a loophole, they will eventually get around to closing it. It will be interesting to follow the first case...

Cheers, Sean
 
I think it’s pretty hard to value. The labor “value” was work done for free essential, it wouldn’t be fair to be taxed on your free labor. Outside of that maybe they could put a value on the materials but even then they are stretching i think. I’m not going to worry about it for the time being, and my accountant agrees with that plan. Ultimately we are just small fish in this new tax scheme.
 
Thanks for the input. It’s just so hard to know based on what is published so far. I’m sure more people finishing planes in the next year or two will get some experience with this. Kind of a grey zone right now.
 
No duty, you'll pay GST/PST/HST as applicable where you live along with freight and brokerage. Watch out for the last one, it bites. There are ways to self clear and cheaper brokerages than the shipper defaults. I have used clearit.ca
 
So then I’m guessing it’s not quite as simple as having it shipped to a US address and going down with a trailer ?
 
Actually.....

Actually, if you are set up to do that - it is.

My experience was as follows:

Show up, tell the officer what you've got. Airplane parts are NAFTA so no duty. You will get picked out, go to the office show the invoice to establish the value, swipe your credit card for the sales tax and be on your way.

As always when you drive across, if they want to, they can look at closely as they want, which is the YMMV.

Derek
 
Derek’s experience mirrors my own, however I’d add that if you’re lucky they may just waive you through without bothering to collect the sales tax. This past July they simply said “have a nice day” when I drove my empennage kit across and declared the value.

So if you’re able, I’d absolutely recommend driving down to grab it and bring it across yourself.
 
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