Property Transfer Tax – First Time Home Buyer’s Program

by Kelvin Scheuer.

British Columbia has a tax on the transfer of real property, called Property Transfer Tax. The tax is based on the fair market value of the real property. The rate of tax is 1% of the first $200,000, and 2% on the balance over $200,000.

However, first-time home buyers who qualify for the First Time Home Buyers’ Program are exempt from payment of the Property Transfer Tax.  Typically, to qualify for the exemption, ALL the following conditions must be met:

The Buyer:

  • You must have lived in BC for 1 full year prior to the purchase date, or have filed 2 income tax returns as a BC resident within the last 6 taxation years.
  • You must be a Canadian Citizen or Permanent Resident. (If you obtain this status within one year after the purchase date, you can apply for a refund).
  • You must have never owned a registered interest in real property anywhere in the world that was your principal residence.
  • You must occupy the real property as your principal residence within 92 days of the purchase date.
  • You must continue to reside in the real property for 1 full year after the purchase date. (If you move out sooner, you may have to pay some of the tax).
  • You must have never received a first time home buyers’ exemption or refund.

The Property:

  • It must have a fair market value of no more than $500,000.  If it is vacant land, the value of the land plus total construction costs must be less than $500,000).
  • It must be classified as residential.
  • It must not exceed 0.5 hectares (1.24 acres) in size.

If the buyer fully qualifies but property does not fully meet all of these conditions, a partial exemption from the tax may still be available.

If you have questions about the First Time Home Buyers’ Program, or about buying or selling real property in BC generally, please contact us.

Testimonials

I wanted to say thank you for your help with making out our wills. We have not needed legal advice until now so I was not looking forward to searching for a lawyer that I trust. You made the whole process easy to understand and my wife and I feel that, with your guidance, we were able to make the proper decisions in regards to our children’s future. I would have no problem recommending you as you are friendly, professional, you listened to our needs, and you are affordable. Thank you for helping us know that our children will be safe and secure if we aren’t around to take care of them.

C.V.

This is just a quick note to let you know how much we appreciated your personal service in preparing a power of attorney for my mother last month. As you know, Mom is quite challenged with the English language and she needs a lot of clarifications. Your draft given to her ahead of time, your use of regular language rather than legalese and your patience with her in your office meant so much to her. She was just as much at ease as when she conducts business in her native French language. So, once again, many thanks for the human touch.

G.D.

I can’t say enough about our satisfaction with Lianne Macdonald. She was extremely patient and understanding and helped us attain our wishes with our will. She gave legal advice but helped us to fulfill our wishes in a way that worked for us.

B.L.

Del was patient, considerate, listened to my issues and treated me with professionalism and respect. Del put in extra thought in drawing up my will by thinking through the legal consequences of different options.

D.M.