Here are the main taxes related to real estate transactions in British Columbia (BC) as of 2024:
1. Property Transfer Tax (PTT)
- A tax on the transfer of real estate
- Rates
- 1% on the first $200,000.
- 2% on the portion between $200,000 and $2 million.
- 3% on the portion above $2 million.
- 5% for the portion above $3 million for residential properties.
2. Additional Property Transfer Tax for Foreign Buyers
- Foreign buyers pay an additional 20% on the purchase price in certain regions.
- 20% for foreign buyers and foreign entities purchasing property in specified areas.
3. Speculation and Vacancy Tax
- Annual tax aimed at reducing empty homes. Rates vary from 0.5% to 2% depending on residency and citizenship status.
- B. C. Government is proposing to raise the tax rate in 2025.
4. Goods and Services Tax (GST)
- Applicable to new or substantially renovated homes.
- Rate: 5% applies to new construction and substantial renovations.
- Rebates: Available for homes under $450,000
5. Underused Housing Tax
The Underused Housing Tax is a federal tax introduced in 2022 aimed at non-resident, non-Canadian property owners who own vacant or underutilized residential properties in Canada. The tax rate is 1% of the property’s assessed value and applies annually. It is part of the government’s broader strategy to address housing affordability issues and increase the availability of housing for Canadians. Some exemptions may apply, such as for certain types of owners or properties used for specific purposes.
6. School Tax
- An additional tax on properties valued over $3 million
- Rates
- 0.2% on the portion between $3 million and $4 million.
- 0.4% on the portion over $4 million.
7. Municipal Property Taxes
- Based on the property’s assessed value and used to fund local services.
- Rates vary by municipality.
8. Capital Gains Tax (on Investment Properties)
- Capital gains on the sale of investment properties are taxable at 50% of the gain at your marginal tax rate.
- Primary residences are exempt from capital gains tax.
9. First-Time-Home Buyers' Exemption (Property Transfer Tax)
- First-time homebuyers may qualify for a full or partial exemption from PTT on homes under a certain price.
- Exemption threshold: Full exemption on homes under $500,000 and partial for homes up to $525,000.
10. First-Time Home Buyers' GST Rebate
- A rebate on the GST paid on new homes under $450,000.
These links lead to official resources where you can find detailed and updated information on each applicable tax or program affecting home buyers and investors in British Columbia.
Here are the taxes related to property flipping in British Columbia and Canada:
1. Federal Anti-Flipping Tax (Implemented in 2023):
- Aimed at discouraging short-term property flipping, this tax applies to individuals selling residential property owned for less than 12 months.
- Exceptions include life events like death, divorce, or relocation for work.
- Any profits from sales within this period will be considered business income, taxed at the full rate.
2. Proposed BC Property Flipping Tax:
- Not yet implemented, this proposed tax aims to curb short-term flipping by introducing higher taxes on property sales within a specific short timeframe.
For more info, check out the federal and BC government tax pages.