Property Transfer Tax – First Time Home Buyer’s Program

by Del Elgersma

Property Transfer Tax is a provincial tax on the transfer of real estate. It is payable at 1% of the first $200,000 of the fair market value, and 2% on the amount over $200,000. The 2003 provincial budget introduced the First Time Home Buyers’ Program, which provides a tax exemption from Property Transfer Tax for individuals buying their first home. Buyers who meet the following conditions will be eligible for the exemption.

The Buyer:

  • must be a Canadian citizen or permanent resident who has:
  • lived in BC for one full year prior to the purchase, or
  • filed two income tax returns as a BC resident within the last six years.

If the buyer is not a Canadian citizen or permanent resident at closing, but becomes one within one year of closing, the buyer can apply for a refund of the tax.

  • must have never owned an interest in a principal residence anywhere in the world at any time.
  • must occupy the property as their principal residence within 92 days of the date the property is registered in the buyer’s name, and must continue to reside in the property for the first year of ownership. If the buyer moves out prior to the one year anniversary,  some or all of the tax may have to be re-paid

If the property is vacant land, the buyer must build and move into the home within one year of the date the property is registered in the buyer’s name, and must continue to reside in the property for the first year of ownership.

The Property:

  • value must not exceed $500,000. A proportional exemption is available for properties that have a value of up to $25,000 above this threshold (ie. up to $525,000).
  • in the case of vacant land, the value of the land plus the total construction costs must not exceed the amounts stated above.
  • must be classified as residential. If some of the buildings on the property are not classified as residential, only a partial exemption is available.
  • must not exceed 0.5 hectares (1.24 acres) in size. If it does, a partial exemption is available.

If you have any questions about the First Time Home Buyers’ Program, please call us.

With competitive fees and a commitment to exceptional service for you and your clients, Beacon Law Centre can be a partner in your success. Our dedicated and knowledgeable lawyers and staff are a resource for your legal questions. We are approved to prepare mortgage documentation for every major financial institution in the area. Our systems and technology are used to improve our service, not replace it. We communicate in plain language, not legalese. Our success is measured by the long-term relationships we enjoy with our clients.

If you would like to work with a law firm that is dedicated to helping you succeed, please call Del or Lianne.

Testimonials

I just wanted to extend my thanks for your absolutely first class service. When we were purchasing our home, as you know, we had many obstacles to overcome and actually thought in the last two days that our deal might not go through. It was a very stressful time in our lives and I want you to know that we’ll always appreciate your calm, caring, professional manner and how you made us feel at ease and that it would all work out because we had you representing us.

You and the rest of your team are awesome, and this is why I will continue to refer you to anyone I know who needs legal representation. As a realtor being able to refer my clients to someone who I know without a doubt will provide them with the best legal advice and service adds to my confidence in terms of the overall service I am providing.

You have, in essence become a key element of my business team and I look forward to building on what is already a successful business relationship.”

M.D.

Over the past year Lianne Macdonald has provided excellent legal advice to my real estate clients. I am always impressed with the quality of her services, as well as the care shown by Lianne and her staff. Lianne is always available if I have any questions or concerns. Her sound advice and legal counsel has greatly helped me in difficult and unusual situations. Lianne Macdonald is a proactive lawyer, an honest and caring person and a trusted friend. Without hesitation, I would recommend Lianne’s services to others, and will continue to use her service where they pertain.

C.W.

Lianne, thank you so much for your excellent work on our conveyance. Your extra work helped save us thousands of dollars.

Dear Mr. Elgersma, I want to thank you and your team for all your help during my recent sale in Victoria. My lawyer here in Ontario was very impressed by your fee and said it was a very good deal in his experience. Thank you very much.

C.G.

I recently had the experience of selling my condo. As I am not in the habit of frequently buying and selling my home I find the whole process a bit unnerving. To add to my unfamiliarity with home transactions, I was due to be out of the country on the completion date of my sale. Needless to say this was somewhat worrisome to me.

I hired Del to handle the legal transaction of my sale. What a great decision this turned out to be. Del and I got together a week prior to my trip and completed the necessary paperwork. There are a lot of papers to sign when selling a home and Del took the time to explain each document to me and answered all the questions I had. He then assured me that he had everything he needed in order to handle the transaction in my absence.

Del had explained everything so clearly to me and made me feel so at ease about the process that I felt completely comfortable leaving my legal interests in his hands while I was off vacationing. This made quite an impression on me as I have never felt comfortable leaving my fate in the hands of others, especially the likes of lawyers!

Previously I would have worried about everything going smoothly on the actual day of my home sale but to my delight and surprise on the completion date of this sale I laid in my hammock and drank champagne in the sunshine celebrating with complete confidence that the transaction would be handled just fine. I returned home only to have my suspicions confirmed . . .yes, in my absence, money had been quietly deposited to my account!

Thank you Del for allowing me to let go of the stress and worry around this large, important and infrequent type of event in my life.

A.W.