Question 1

Do I need a bill of sale to sell equipment in Canada?

Accepted Answer

While not always legally required, a bill of sale is highly recommended as it provides proof of the transaction, establishes transfer of ownership, and protects both parties. It is essential for tax reporting and PPSA purposes.

Question 2

What is a PPSA lien search and why is it important for equipment purchases?

Accepted Answer

A PPSA lien search checks whether any security interests are registered against the equipment. If a lien exists, the lienholder may have priority claim to the equipment. Buyers should conduct a search through the provincial Personal Property Security Registry before purchasing.

Question 3

Is GST/HST payable on used equipment sales in Canada?

Accepted Answer

GST (5%) or HST (13%-15%) generally applies to commercial sales of used equipment. Private sales of personal-use items may be exempt. Registered businesses can claim input tax credits on equipment purchased for commercial activities.

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