If you cross the border to buy a car and then transport it back to your residence you are “importing” the vehicle. Many Canadians come to the United States to buy cars because the prices can be as much as 20-30% lower than buying the same car in Canada. In addition, car enthusiasts come to the states because of the wider selection of vintage or classic cars.
Americans going to Canada to buy an auto happens much less often. U.S. regulations are extensive and frequently require vehicle modifications that can be costly. We have created separate pages for Importing a Car into Canada from the U.S. and another for Importing a Car into the U.S. from Canada.
Some auto manufacturers try to protect their dealership territories by prohibiting or discouraging cross border sales. Prices you see online or get over the phone can disappear when you show up in person and the American dealer discovers you are Canadian. Some manufacturers disallow discounts and incentives if the purchaser is not from the U.S. In addition, given that vehicle maintenance and service is a growing part of dealer revenue, many dealers are less motivated to sell to someone not in their local dealership territory.
Secondly, you should be very careful to confirm that vehicles purchased in the U.S. and brought across the border will be protected by the manufacturers warranty. The dealer may not even fully understand if the warranty will be honored so do your homework. In addition, if you need to modify the vehicle to conform to Canadian standards, there is a chance you will void the warranty.
Don’t even think of handing over any money until you are absolutely sure you know what modifications you will need to make to the vehicle to bring it into either country. In many cases, modifications will exceed the value of the vehicle. Be skeptical of claims by the seller and make sure you do your own research on that specific vehicle. If you buy the wrong vehicle, you may need to export it back out of the country or destroy it.
If you are bringing more than $10,000 in cash across the border you must inform border officials on both sides before crossing. It is not illegal to bring that much across, but you are required to disclose it.
Things will go smoother if you do not use the vehicle as a shipping container. You are required to declare the entire contents of your car so having lots of stuff in the vehicle will slow down the process. If customs officials decide to search the vehicle and find items you failed to list you can be fined. If you are caught bringing something illegal across the border, the vehicle and all it’s contents can be seized.
If you do not want to go through all the required steps there are many companies that will handle some of this paperwork, pick up your vehicle from the seller, and ship it to a bonded warehouse near your residence.
Although a vehicle may be approved for import, there is a possibility you may have difficulty if you later want to trade it in to a dealer for a new vehicle. For example, if the odometer is in kilometers an American dealer may feel they will have difficulty selling it and therefore won’t want to buy it from you.
You should absolutely check out the vehicle history using a service such as Carfax or VinAudit.com before making any purchase. This report will show you the history of the car, including any accidents serious enough to block entry or require additional testing.
Because it can be expensive to import a vehicle, some people try to skip steps or dodge various regulations. If you check around the Internet you will find people who claim they got away with hiding one thing or another. Playing this game can be an expensive mistake. Both governments can impose substantial penalties on you for violating their regulations – whether done intentionally or accidentally.
Customs officials are keenly aware that people hate paying taxes on expensive cross-border purchases, and they know the temptation to cheat is quite high. As a result, they usually check out vehicle imports pretty carefully. Officials will go so far as to call the vehicle seller or check out the online sales price of an advertised vehicle. If you lie about what you paid for the vehicle it can be seized – Canada seizes over 150 cars a year. If that happens, you will likely end up in court and have to pay a penalty of anywhere from 25 to 75 per cent of the undeclared value to have it released.
We can’t tell you how to live your life, but you should realize that a bad decision could cost you a whole lot of money, and may result in a ban that prevents you from ever crossing the border again. From our perspective, if you can’t afford to do this right, wait until you can.