When you own, lease or gain an interest in a property (e.g. land, home, etc.) located in B.C. you must pay property taxes. Below, we have some information on taxes to consider when purchasing a property.
1.PROPERTY TRANSFER TAX (PTT)
This tax is mandated by the PROVINCIAL GOVERNMENT, & is calculated as follows on the Purchase Price of the home:
1% on the 1st $200,000
then 2% on the balance up to & incl. $2,000,000,
then 3% on any remaining balance over $2,000,000.
A further 2% on the portion of the fair market value greater than $3,000,000.
The tax is payable on the purchase of all properties in BC with the following exemptions:
You are a First-Time Home Buyer and Fulfill the following criteria:
- - Have never owned an interest in a principal residence anywhere in the world at any time.
- - Are a Citizen or Permanent Resident of Canada
- - Have resided in B.C. for 12 consecutive months
- - Move into the property within ninety-two days after registration of the purchase of the property and reside in the property for at least one year.
Only be used as your Principal Residence:
- - Fair Market Value of $500,000 or less
- - Be 1.24 acres or smaller
- - Partial exemption to $525,000
Newly Built Home Exemption
- - Only applicable to Fair Market Value up $750,000
- - Partial exemption $750,000 - $800,000.
Does this home Qualify as a Newly Built Home?A Newly Built Home is:
- - A house built on vacant land
- - A new apartment in a newly built condominium building
- - A manufactured home on vacant land
- - An existing house that has been moved from one parcel of land to a vacant parcel
- - A new house or houses resulting from the subdivision of a lot, as long as the new house(s) haven't been occupied since the subdivision
- - A house converted from an existing improvement on the land. The previous improvement couldn't have been part of residential use. For example, a warehouse converted into apartments.
2. GOODS AND SERVICES TAX (GST)
- - Payable in your service fees (inspections, legal, real estate commission-if applicable, moving costs)
- - Is NOT charged on the purchase of re-sale property, ONLY new construction or substantially renovated homes
- - Is sometimes (but NOT ALWAYS) included in the purchase price of new construction
3. PROPERTY TAXESThese are taxes levied by your local Municipal Government, calculated from the property's Assessed Value that is adjusted yearly.
- - Sometimes can be combined with your mortgage payment
- - May be partially payable on Completion Date
- - Payable annually to your local government offices