Bill of Sale

Region: Ontario Answer # 0800

What is a Bill of Sale?

A bill of sale is a legal document, which transfers ownership of property from one person to another. They are also referred to as receipts, sales receipts, and proof of purchase. Bills of sale are used in the sale of moveable and tangible personal property. Personal property can be transferred in a variety of ways, such as: sale, exchange, gift or pledge (mortgage).

What is the difference between a sales agreement and a Bill of Sale?

A bill of sale is not the same as a sales agreement. The primary difference is that a sales agreement is used for more complex and detailed transactions, whereas a bill of sale is basically a sales receipt. For example, sales agreements can allow for multiple payments, or may provide warranties as to the use or quality of the item sold.

What information do Bills of Sale include?

Laws pertaining to the sale of goods are set out in each province’s Sale of Goods Act. In order for a transfer of ownership to be legally documented by a bill of sale, the following conditions must be present:

  • the transferor must be the legal owner of the property, and
  • the property being transferred must be ‘moveable and tangible’.

Bills of sale include information, such as:

  • the identity of the buyer and the seller,
  • a statement that the owner has legal title to the property,
  • a description of the property, including an ‘as is’ statement,
  • the purchase price,
  • whether any liens on the property exist,
  • the signature of the seller, and
  • the date of the sale.

In many bills of sale, the seller will include a statement that the buyer has inspected the property prior to purchase and that the buyer understands that the property is being sold ‘as is, and without any warranty’ as to its condition, usefulness, or quality.

Bills of sales are used to transfer ownership of a variety of personal property, such as:

  • motorized vehicles, (including such vehicles as cars, motorcycles, trucks, boats, trailers, snowmobiles, tractors, aircrafts etc.),
  • equipment and tools,
  • furniture and household items,
  • electronics, and so on.

Why use a Bill of Sale?

The main reason to use a bill of sale is that it provides proof of the transfer of ownership. This is especially important when transactions pertain to used personal items, where there is no other means of determining ownership. In sales involving cash payments, a bill of sale also provides proof of payment. Both the buyer and the seller should keep a copy of the bill of sale.

There are some transactions where the provision of a bill of sale is mandated by law. For example, in the case of the purchase of a used vehicle, provincial legislation often requires a bill of sale to register the vehicle to the new owner. Check with the Ontario Ministry of Transportation for a template bill of sale for use when selling a car.


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