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 included changes to 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.
– 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.
– value must not exceed $475,000. A proportional exemption is available for properties that have a value of up to $25,000 above this threshold (ie. up to $500,000).
– 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.