The BC government has made changes to the latest budget regarding the property transfer tax. The following changes will be effective on all purchases closing as of February 17th, 2016 and going forward:
- All buyers (whether first-time buyers or not) no longer pay property transfer tax on purchases of new homes up to $750,000 in value
- The buyer must be a Canadian citizen or a permanent resident.
- There is a partial exemption for homes between $750,000.00 and $800,000.00.
- The property must be a primary residence for 1 year and moved into within 92 days.
- The BC government will be sharing information with CRA to ensure rules are being followed.
- Property transfer tax has changed so that there is now a 3% tax on amounts over $2,000,000.00 - the 3% tax is only paid on the amount over $2,000,000.00, not the full price. (For example a $4,000,000 purchase price on the 1% on the first $200k, 2% on the next $1.8 million, 3% on the amount over $2 million. The property transfer tax would equal $98,000. This is a $20K increase from the old rules).
- All Buyers must disclose their citizenship for government tracking.
- There are no changes to the first-time home buyer exemption limits.
For more information please refer to the BC Government Property Transfer Tax website. A link to the BC Property Transfer Tax exemptions is available here.