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UNDERSTAND HOW PROPERTY TRANSFER TAX EFFECTS YOU IN BC

You are charged property transfer tax when you make changes to a properties title, including:

  • acquiring a registered interest in the property 
  • gaining an additional registered interest in the property 
  • becoming the registered holder of a lease, life estate, or right to purchase for the property

What are some examples of the types of taxable transactions that occur 

  • transfer of fee simple
  • right to purchase or agreement for sale
  • lease or lease modification agreements
  • life estate
  • foreclosure
  • Crown grant
  • escheat, forfeiture or quit claim
  • transfer as a result of corporate reorganization

The amount of tax you pay is based on the fair market value of the land and improvements(e.g. buildings) on the date of registration unless you purchase a pre-sold strata unit.  Let’s see the breakdown below:

The property transfer tax rate is:

  • 1% on the first $200,000,
  • 2% on the portion of the fair market value greater than $200,000 and up to and including $2,000,000,
  • 3% on the portion of the fair market value greater than $2,000,000, and

if the property is residential, a further 2% on the portion of the fair market value greater than $3,000,000 (effective February 21, 2018).

If the property is classified as residential and farm, or is residential mixed class (such as residential and commercial), you pay the further 2% tax on only the residential portion of the property. 

HOMEBUYERS

You may qualify to reduce the amount of tax you need to pay if you are a first time home buyer or you are purchasing a newly build home.

Get an estimate by clicking the link below:

ESTIMATE PROPERTY TRANSFER TAX

 

SOURCE: gov.bc.ca