2018 BC Budget, how does it affect Our Real Estate:
Photo source: Province of British Columbia
ADDITIONAL PROPERTY TAX FOR FOREIGN ENTITIES AND TAXABLE TRUSTEES
- Has gone from 15% to 20%, effective today.
- Contracts written before Feb. 20, 2018 with a closing on or before May, 2018 are exempted, but only for Capital Regional District, Fraser Valley Regional District, Regional District of Central Okanagan or Nanaimo Regional District. Note this exemption does not apply in Greater Vancouver.
- Transfers pursuant to court order, order nisi of foreclosure, separation agreement, transfer from personal rep of deceased’s estate to beneficiary or transfer to surviving joint tenant are also exempt, provided the triggering event occurred before Feb. 20, 2018.
- This tax applies to the Capital Regional District, Fraser Valley Regional District, Regional District of Central Okanagan, Nanaimo Regional District and Greater Vancouver. The areas for each region can be found at https://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax/understand/additional-property-transfer-tax/bc-areas
- Only on residential property; if property is farmland or commercial with a residential component, tax applies on the residential component.
- Exemption for BC Provincial Nominee Program still applies.
- Tax is meant to target foreign and domestic homeowners who do not pay income tax in B.C.
- Tax will apply to same areas as foreign buyers tax apart from Okanagan, where it only applies to Kelowna and West Kelowna.
- Starts in 2018 at $5.00 per $1,000.00 of assessed value, goes up to $20 in 2019.
- Not sure how this will affect vacation homes, nor when this tax is payable.
This tax is now under review and may be scrapped or adjusted. For more info https://www.mortgagebrokernews.ca/business-news/b-c--may-revise-new-tax-238792.aspx
PROPERTY TRANSFER TAX
- Tax rises from 3% to 5% on value of homes over $3,000,000.00.
- Remains at 1% on first $200,000.00, 2% on amounts between $200,000.00 and $2,000,000; 3% on amounts between $2,000,000.00 and $3,000,000.00 and 5% on amounts over $3,000,000.00.
PRE-SALE CONDO ASSIGNMENTS
- Developers will collect and report information about pre-sale condo purchases; nothing else in budget about pre-sale contracts or assignments that we have seen.
B.C. HOME OWNER SECOND MORTGAGES
- This program is now cancelled – don’t think it was used much anyway.
For full details and videos on the 2018 BC BUDGET,
click here http://bcbudget.gov.bc.ca/2018/default.htm