Frequently Asked Questions - when SELLING a BOAT

As a Yacht Broker, we get questions all the time from our powerboat and sailboat buyers in Ontario, about Licensing and Registering boats. There have been several changes to both systems over the last year or two, so it seems that there is some confusion about both.

All boats with a 10hp engine or more must have a Pleasure Craft Licence or a Federal Registration. Buyers often ask if they should formally register the vessel in the Canadian Register of Vessels instead of Licensing. Registration is a title-backed process required if you plan to get a marine mortgage, showcase official proof of ownership internationally, or want a custom boat name and homeport. 

It is important to know that a vessel CANNOT be Licensed AND Federally Registered at the same time.

Normally, a buyer of a boat will continue with the type of documentation [Licence or Federal Registration], that the boat carries at time of purchase. 

VERY IMPORTANT: Before purchasing a vessel, and indeed before getting too far into the process or spending any money on due diligence, insist on getting a copy of the sellers’ Vessel Licence or Federal Registration. At Breezeway Yachts, we regularly have requests to list boats that have not had the ownership [Provincial Licence or Federal Registration] updated with Transport Canada. We know that this can be a difficult process when proper Sale Documents have not been provided to the new owner. Don’t put yourself in that situation.

PROVINCIAL LICENCE

A Licensed Vessel is required to have its Licence number printed on the bow of the boat. It is usually a 50E33333 or ON444444 format for the licence number [the ON format for Ontario boats came into place in April 2010 but older boats were not required to switch to the new format].

Licensing is an inexpensive documentation method and is quite sufficient for travelling on the Great Lakes, even into to US. Note that there have been some very recent changes to the Licensing system:

• all new, transferred and renewed Pleasure Craft Licences are valid for 5 years
• older licences without an expiry date now have an expiry date
• a $24.41 fee to apply for a new, renewed, transferred or duplicate Pleasure Craft Licence
• you must update your licence information [change of address for example] within 30 days (there is no fee to update)
• starting December 31, 2027, wind-powered pleasure craft over 6 metres long will need a Pleasure Craft Licence

When purchasing a Licensed boat, Transport Canada requires prompt action to change the Licence:

“If you acquire a pleasure craft that already has a Canadian Pleasure Craft Licence, you need to transfer the licence into your name before operating the pleasure craft. You must do this within 30 days of the ownership change.” [before fines become applicable.]

If you have purchased a Licensed vessel, and you have not yet changed the Licence to reflect your ownership, you can start here:

Before you apply

FEDERAL REGISTRATION

A Federally Registered vessel will have the vessel name displayed on the hull of the boat, along with the Port of Call, but no number. There is a six-digit number associated with the Registration, and that is to be displayed on a plaque mounted inside the boat.

Federally Registering a Licensed vessel does involve completion of several documents, and a professional Tonnage Survey if the boat is over 15 meters in length, so this can be fairly costly for a larger boat.

Both Licenses and Registrations must be renewed regularly [Federal Registrations are no longer automatically renewed], both involving a modest cost.

Rules and procedures around both systems have been changing quite a bit since early 2025. One significant change is the ability to transfer a Federal Registration online now, in addition to the old mail in or email in options. Additionally, a new Form 1 has been created, and is now required along with the traditional documents [Form 6 Bill of Sale, Statement of Qualification, Appointment of Authorized Rep if more than one owner].

As with Licences, there is a 30 day window to transfer the Registration before fines become applicable.

It is best to review the regulations whenever you decide to make any change to your boat documentation. This is a good place to start: 

Vessel licensing and registration

Boat owners should be aware that a Vessel Licence is not considered a Title Document, so it is important to carry a copy of your purchase Bill of Sale along with your Vessel Licence every time you leave the dock. Most will generally leave copies of both documents on board at all times, keeping originals at home.

Purchasing a boat is not a difficult process and many successfully navigate it on their own. 

A good Yacht Broker will bring a lot to the table, from evaluating fair value for a boat, to reviewing the survey with the client, confirming ownership of the vessel, and handling documents and funds securely.

In addition, when using a Yacht Broker to represent you in a purchase, the fee is paid by the seller from the sales commission, so take advantage of the service and value.

No.

There are a couple of scenarios here. 

First, If you are buying a boat that is owned by a company [ie. a New Yacht or a Trade-In], the yacht dealer will have to collect HST at time of purchase.

Secondly, if you purchase a boat outside of Canada, the boat will be taxable upon entry to Canada. From the Transport Canada website:

" The Canada Border Services Agency (CBSA) will ask you for specific documents as well as information on the boat and the seller to confirm the sale and assess the duties and taxes on the boat. Before buying the boat, contact the CBSA to find out what you will need from the seller to bring the boat to Canada."

Consider working with a Customs Broker that has experience in importing vessels.

All purchases of privately sold, or brokered boats, are subject to tax, however it is not collected at time of sale.

The Canadian Border Services Agency will determine if a duty is payable. Boats manufactured outside of North America are subject to an import duty, generally 9.5% of the boat purchase price.

North American built boats are not subject to an import duty. But you will be expected to prove the country of manufacture, generally through a Certificate of Origin or Builder's Certificate. These are not difficult to obtain, if the builder is still in business. As an example, we were looking at importing an older model Hunter sailboat a few years ago. The Hunter brand had been sold off in the Luhrs bankruptcy. We contacted Marlow, the purchasers, and they claimed to not have any historical, pre-purchase, files. So no Certificate of Origin or Builder's Certificate. And note, builders will only ever supply one Builder's Certificate which will initially go to the dealer if they request it, and then to be supplied to the first owner.

There was some talk a few years ago about European boats being Duty Free. This applies only to New Boats, imported directly by a dealer. There are also additional restrictions to qualify for duty free status.

This question is addressed in our DOCUMENTS page, so please pop over there for a complete answer.

And note, that Licensed boats, Federally Registered boats, and US Boats all have different answers.

Quickly, the Owner of a licensed boat will have a paper copy of that Licence, indicating the Owner[s] name[s], Address, Vessel HIN and the Licence Number. This doesn't guarantee that they currently own the boat, just that they did at some point [they could have just sold it to someone else, before you arrived].

The Owner of a Federally Registered boat will also have a paper copy of that Registration. They will also appear on the searchable Federal Registration database [visit our DOCUMENTS page for more on this]. Again, this is not an iron-clad guarantee, but a new owner who transfers the registration promptly will show on the database, but that can take up to 8 weeks to be processed.