Topic: Sorry But We Are Going To Pay More Taxes For New Cars

[Dofwarrior]

Hello everyone, last july we wanted to buy a new Kia. After turning down the dealers offer they would not return our deposit. We have since filed a lawsuit against them and during the investigation proccess we found a loop hole the dealers have been using to save consumers money in taxes. The dealer tried to use the loop hole as a defense " Dummies " which proved how they had been doing it. Revenue Canada and the IRS are currently auditing the Industry and we will see it in the news soon. I contacted Kia Canada and Kia US headquarters but they just played stupid. All we wanted was the deposit back and now we all will have to pay more taxes for our new cars. So when you go to buy a new vehicle in the future just remember, Kia is the reason your paying more taxes.  

Sincerly,  

John

[safristi]

Thanks 'Do.....retired at 35 and still bitchin'

[wing]

So it's YOUR fault?

[Dofwarrior]

Well.... no it's not our fault. We had to kill thier defense at the preliminary hearing and once the cat was out of the bag the government took over.

[ovr50]

Dof - I'm a little thick-headed here and I don't understand a couple things about your post - 1. how does the dealer have your deposit when "they are making you an offer"? You must have given them a deposit and signed some contract. No one gives a deposit without signing something. Then you changed your mind? What reason did the dealer give for not returning your deposit. The entire story is not out on the table here. 2. exactly what is this "loophole" the dealers are using? 3. what is changing that makes everyone pay more taxes on purchase? How much more? To me, you've opened up more questions than you have answered. Maybe if you fill this post in a bit more, we can better understand and comment.  
More info. would be appreciated. Thanks.

[ovr50]

Saf, he's only 33 and retired - or so it says? Not that it matters to the content of the post. Let's find out more here.

[Dofwarrior]

Sry people I could have been more elaberate.

Yes I am  33 and retired, I have Mutiple Sclerosis and cannot work.


1)We signed a offer to purchase which had limits as to how high the payment could go. They went over the amount specified. And they requested a deposit at that time.

2)The loop hole,

For example, you want to buy a $1000 vehicle

Your trade is worth $1000
You owe $1000 to the bank

Your purchase price of the new vehicle is still $1000 but they still reduce the tax by the amount of the trade in.

3)Changes: If you had a deal like this you would now pay tax on the total price of the new vehicle.

4)How much more taxes?
Our deal would have saved us $175.00 in taxes with a $2500. trade in

Revenue Canada has very clear rules on the matter that an be found @  

http://www.cra-arc.gc.ca/E/pub/gm/b-084r/b-084r-e.html

If you have any other questions please ask.

(Message edited by dofwarrior on December 18, 2004)

[ovr50]

As I understand the rules, and I'm no expert, the GST is payable only on the difference between the sale price and the agreed trade in value, regardless of any loans owing against the trade in. In the example given on the govt. web page, the new car sale price was $20,000, the trade in was worth $5,000 and $3,000 was still owed on the trade in car. The amount the buyer pays is $18,000 plus GST on $15,000 ($20 - $5).  
It seems that the payment limits were violated thus there was no binding contract. How much was the deposit and why such a hassle to get it refunded? This doesn't, based on your posts, seem to have much to do with how the GST is charged? Since you're in AB, PST is not an issue here. What was the dealer doing that causes the CCRA to investigate? Some dealers may be abusing the rules but that only means they will be forced to follow the rules. Not all and honest dealers are impacted.  
I can, however, see where the rules could change to charge GST on the "clear" difference only ie. in the example above, GST would be charged on the value of $18,000 (in that GST has not been paid on the $3,000 loan value yet).  
I suspect there is more to this than a case over a held deposit and GST of $175. Maybe the CCRA was looking at the whole trade-in with loans attached area anyway. Hey, if you really caused all this hassle over $175, we'll all come after you.

[articsteve]

Just because he is "retired" doesn't mean that he has any money.

I "retired" in May 1987.  I then became a "hobby farmer" lol .  Since that date all my tax returns state:  "NIL"

Just a minute, I need a calculator ....  I was 33 1/2 when I stopped CPP contributions.  The dude beats me by 1/2 year.

Over50, obviously you are adhering to the true spirit of Xmas, because your post is really generous because that is one incoherent original post.

My take is that this first time poster is a poor soul that had wondered into a Hyundai dealership intoxicated, lost his sanity temporarily and laid a deposit on one of those beauties only to wake up the next day to the horror of his actions.

Subsequently, he has gone off the deep end and has devoted his existence to the demise of Hyundai.

Notice to Dealer Buyers of any brand, new or used vehicle:  Despite their screaming, always use a personal cheque to pay for a deposit.  Hence, a few days later when you come to your senses, you stumble down to the bank; confess to your stupidity and stop payment.

It's all about the money.  If the dealer has your sig on a contract, but no money they will let it go.

Merry Xmas

[Dofwarrior]

The dealer used this as there defense in court. That the trade made the difference in gst which changed the lease payments when it should not have. I have spoken to Revenue Canada Ruling officers and they understand it and have forwarded it to the audits  dept.

[articsteve]

Dofwarrier:

Off topic, but for what's it's worth buddy contact CBC Radio One (website or whatever) and search for an interview with a Canadian Scientist who son came down with MS and recovered fully.

The father has a very comprehensive scientic style research website and now speaks around the world on his findings.

Esentially, it entails eliminating certain elements from your diet and large amounts of Vitamin D or whatever it is you get from the sun or ultra violet rays.

My son recently started "tanning" in tanning places about once a week and after hearing this interview and reading on the subject I kept my mouth shut.

Highest rate of world MS is in Canada and in the north.

[articsteve]

Dofwarrier:

Off topic, but for what's it's worth buddy contact CBC Radio One (website or whatever) and search for an interview with a Canadian Scientist who son came down with MS and recovered fully.

The father has a very comprehensive scientic style research website and now speaks around the world on his findings.

Esentially, it entails eliminating certain elements from your diet and large amounts of Vitamin D or whatever it is you get from the sun or ultra violet rays.

My son recently started "tanning" in tanning places about once a week and after hearing this interview and reading on the subject I kept my mouth shut.

Highest rate of world MS is in Canada and in the north.

[articsteve]

Sorry for double posts.  For "high speed" in my location, I am stuck with Bell and they insist on the Speedstream 3600 router and a Linksys only card and they both SUCK!

[Dofwarrior]

This all started over a $500 deposit the would not return to us. We ended up in court and they used this loop hole as a defense. Criminal charges will be pending in March after the trial against the officers of Metro Kia for violations of the fFair Trading Act,obstruction of justice, and fraud. I had two law agencies investigate them and they provided different information to both on different dates. They manufactured documents to suit there needs to cover up what they had done.

[Sterling]

Dof, your posts are still very vague. You've made 4 posts and still have not clearly explained what happened. Instead of picking random numbers out of the air why don't you just use the exact numbers from your transaction so we can understand what you are talking about.

Regardless of what happened to you there will be no industry wide change because of it. If that one dealer was doing something wrong then things may change for them.

edit: just noticed you claim that the IRS is now involved because of your lawsuit? Sure it is. Why would the IRS give a rats ass about some guy's bad Kia deal in Alberta?

(Message edited by Sterling on December 18, 2004)

[Dofwarrior]

The IRS is interested because the same loop hole is being used in the united states.

[Mdxtasy]

Trying to understand this loophole is like threading a needlehole.  I'm not edumakated enuf or the fact that I'm finished my Christmas shopping is causing this brain fart.  

The loophole is they charge you GST on the full price of the vehicle?

[Sterling]

I assume this happened in Alberta? Where only GST and no PST exists. The IRS deals with federal taxes. There is no federal tax on cars in the U.S similar to the GST. There is tax levied by individual states. However, state taxes are not administered by the IRS.

As I said, this particular dealership may have done wrong but your claims about Canadian and U.S. federal tax agencies being involve is BS.

[Dofwarrior]

Say what you wish Sterling, but facts are facts

[Mdxtasy]

If you take out the $2500 trade in....you would be paying more for the car then right?  If you are paying a higher amount, would GST not be higher as well?  I guess I'm still not following.