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What is the Bare Trust Loophole?

What is the Bare Trust Loophole?

The NDP wants to close the Bare Trust Loophole. This loophole has been mentioned in many of the most recent articles about real estate yet many have no idea what this loophole is that they are referring to.

What is the Bare Trust Loophole?

It is a loophole which helps purchasers avoid paying property transfer tax in British Columbia. As well as the 15% foreign buyers tax and other federal income taxes. This loophole has helped some individuals conceal their identities by being allowed to buy and sell properties through a trust or holding company. How to avoid paying Foreign Investment Tax? This is one way that Foreign Buyers are able to hide that they are not Canadians and purchase without paying the 15% Foreign Investment Tax. This loophole also is responsible for helping individuals avoid paying Capital Gains when selling investment properties. Investment properties are not exempt from Capital Gains like principal residences are.

For more information about anything Real Estate related contact The Arm Group at 778.822.5929

What is the Bare Trust Loophole?

 

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