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NEW BC TAX RULES

NEW BC TAX RULES

BC tax, foreign buyer

New Vancouver Real Estate Tax

New TAX Measurements in the 2018 BC Budget have been announced…
Brace yourself, there are a lot of changes coming, Real Estate is going to be harder and more expensive than ever to purchase and sell. There are 5 new Tax measures for Real Estate in BC.

NEW TAX’S

  • 2% Speculator Tax. What does this mean? A Speculation Tax targets those who are trading real estate as an asset or conducting financial transactions with the expectation of creating a substantial gain. In other words, anyone who is flipping properties.
  • Increasing the Foreign Buyers Tax to 20%!!!! (Originally 15%)
  • Increasing the Foreign Buyers Tax to more areas outside of just Metro Vancouver. This means anyone who is not a full Canadian Citizen will be paying 20% extra to purchase a property. This money is not returned or recouped when the Buyer sells the Home. All the proceeds will go to the Government.
  • PTT – Property Transfer Tax on homes over $3,000,000 will be increased
  • School Tax will be increased on homes over $3,000,000

 

Further Details:

Speculation tax

  • The province will implement a new speculation tax on residential properties, targeting foreign and domestic homeowners who don’t pay income tax in BC. This includes those who leave homes vacant.
  • The tax will apply to the Metro Vancouver, Fraser Valley, Capital, and Nanaimo Regional districts and in the municipalities of Kelowna and West Kelowna.
  • In 2018, the tax rate will be $5 per $1,000 of assessed value. In 2019, the tax rate will rise to $20 per $1,000 of assessed value.
  • The province will administer the tax and will collect data to enforce it including, social insurance numbers, household information, and worldwide income information.

Foreign buyer tax

  • Effective Feb. 21, 2018, the foreign buyer tax will increase to 20 percent from 15 percent and will be extended to the Fraser Valley, Capital, Nanaimo, and Central Okanagan Regional Districts.
  • If the property is located in the Capital Regional District, Fraser Valley Regional District, Regional District of Central Okanagan, or Nanaimo Regional District, and the property transfer is registered on or after February 21, 2018, there are transitional rules available here.

 

Property Transfer Tax

Effective Feb. 21, 2018, the Property Transfer Tax on residential properties above $3 million will increase to five per cent from three per cent.

Provincial School Tax

Beginning in 2019, the provincial school tax will increase on most residential properties in excess of $3 million.

Database on pre-sale condo assignments

The province will require developers to collect and report comprehensive information about the assignment of pre-sale condo purchases. The information will be reported to a designated government office and shared with federal and provincial tax authorities to ensure taxes are paid.

Online accommodation PST and MRDT

Online accommodation platforms are enabled to collect and remit the Provincial Sales Tax and Municipal and Regional District Tax (Hotel Room Tax).

Property tax treatment for ALR land

As part of the Agricultural Land Reserve (ALR) review, the province is examining residential land in the ALR to ensure land is used for farming.

 

Clarity of property ownership

Compelling access to MLS®

The province plans to enable tax administrators to compel access to information relevant to property transfers, such as information held in a MLS® database. (We’re asking government for clarification.)

Beneficial land ownership registry

The province will require additional information about beneficial ownership on the PTT form.

Administered by the LTSA, the information will be publicly available and shared with federal and provincial tax and law enforcement authorities. Legislation will be introduced to require BC corporations to hold accurate and up to date information on beneficial owners in their own record offices available to law enforcement, tax and other authorities.

Task force on money laundering and tax evasion

The province will work with the federal government to formalize a multi-agency working group on tax evasion, money laundering and housing.

Residential Tenancy Branch

Increased funding to the Residential Tenancy Branch to reduce wait time, improve service and deal with disputes more quickly, as well as strengthening the Residential Tenancy Act and the penalties for those who repeatedly break the law.

Read the Homes for BC 30-point plan for housing affordability

Read the Budget press release

Read the Fiscal Plan (opens a 157-page pdf)

Read the Budget 2018 Speech

 

 

 

new real estate tax bc Ashley nielsen

 

For more information about the new regulations contact The Arm Group at

Ashley Nielsen 778.822.5929

Nikki Mayers 778.554.5851

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