No -Property Transfer Tax – On Newly Built Homes UP To $750,000

By
Real Estate Sales Representative with RE/MAX Camosun Victoria BC Real Estate BC Licence #001159

On February 16th, the BC Government announced the 2016 Budget for the province, which introduced several changes to the Property Transfer Tax Act.

 

These changes affect any real estate transaction that is completing February 17th onwards, regardless of the date the contract of purchase and sale was executed.

 BC Property Purchase New Home exemption

1.    Changes to the BC Property Transfer Tax Rate

 

One of the changes to the Property Transfer Tax Act is a new tax rate of 3% for properties with a fair market value greater than $2,000,000.  The Property Transfer Tax (PTT) is now calculated as follows:

 

1.    1% of the taxable transaction’s fair market value that does not exceed $200,000.

2.    2% of that fair market value that exceeds $200,000 but does not exceed $2,000,000.

3.    3% of that fair market value that exceeds $2,000,000.

 

2.    Property Transfer Tax – Newly Built Home Exemption

 

No Property Transfer Tax – On Newly Built Home ExemptionAnother change to the BC Property Transfer Tax Act is the addition of a new exemption – the Newly Built Home Exemption. Below are some key points to consider:

 

1.     The exemption applies only to newly built homes.

2.     There is a full exemption for qualifying properties with a fair market value of $750,000 or less and a partial exemption for qualifying properties with a fair market value between $750,000 and $800,000.

3.     The party claiming the exemption:

a.     must be a Canadian citizen or permanent resident.

b.    must use the property as a principal residence.

c.     does not have to be a first time home buyer.

 

3.    Further Information

 

Below are some links with further information regarding the qualifications criteria:

 

1.    Frequently Asked Questions about the changes to the BC Property Transfer Tax Act: http://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax/understand/exemptions/newly-built-home-exemption#qualify

2.    A Guide to the Property Transfer Tax – Newly Built Home Exemption: http://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax/understand/exemptions/newly-built-home-exemption#qualify

3.    A Table of Property Transfer Tax – Newly Built Home Exemption amounts: http://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax/understand/exemptions/newly-built-home-exemption/exemption-amounts

 

This is only a summary of some of the changes and is not exhaustive. See the above links and the Property Transfer Tax Act for more information,  

Source: Mullin DeMeo Real Estate Lawyers

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Praful Thakkar
LAER Realty Partners - Andover, MA
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Isn't that a great news for buyers Fred Carver Personal Real Estate Corporation ?

Feb 22, 2016 03:31 PM #1
Rainmaker
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Sandy Padula and Norm Padula, JD, GRI
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Fred Carver Personal Real Estate Corporation Clearly, your government is trying to stimulate the home building industry and that is a good thing when one considers all the jobs created from this industry.

Feb 22, 2016 09:40 PM #2
Rainmaker
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Hi Praful Thakkar It certainly is for the New home builders and buyers buying new homes in Victoria,

Cheers, have a fun and successful day!

Feb 22, 2016 11:14 PM #3
Rainmaker
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Hi Sandy Padula and Norm Padula, JD, GRI This is certainly a positive move, we had hoped for the same Tax elimination on exiting home purchases.

Cheers, have a fun and successful day!

Feb 22, 2016 11:16 PM #4
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Good evening Fred Carver Personal Real Estate Corporation . I have to agree with Sandy. It does seem as if your goverment is trying to stimulate RE sales.

Feb 26, 2016 07:37 AM #5
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