Do you qualify for the exemptions to the BC Foreign Buyers Tax? Today we cover the three main exemption categories to the BC Foreign Buyers Tax.
Exemptions to the BC Foreign Buyers Tax
The three main exemption categories of the tax are:
- Principal Resident of a Residential Property
- BC Provincial Nominee program
- Canadian-controlled Limited Partnerships
Principal Resident of a Residential Property
The first exemption is if you own a residential property and use it as a principal residence. This is the same as one of the exemptions to property transfer tax.
The exemption doesn’t apply to the additional property transfer tax in the following situations:
- A transfer resulting from an amalgamation
- A transfer to a surviving joint tenant
- A transfer where the transferee is or becomes a trustee in relation to the property, even if the trust does not change
B.C. Provincial Nominees
To qualify for this exemption you must:
- Be a confirmed B.C. Provincial Nominee when the property transfer is registered with the Land Title Office
- Use the property as your principal residence
- Make the property transfer to an individual
Keep in mind this exemption only counts one time. Each new property purchased after will be subject to the foreign buyers tax.
Canadian-controlled Limited Partnerships
The third exemption is if you are a general partner who is a Canadian citizen or permanent resident and you are purchasing a property on behalf of a qualifying Canadian-controlled limited partnership. Then you may be exempt from paying the foreign buyers tax.
To qualify for this exemption, the property (land and improvement) transfer must be registered at the Land Title Office on or after June 1, 2020 and:
- Each general partner must be a Canadian citizen, a permanent resident of Canada or a corporation that’s not a foreign corporation
- Each general partner and each limited partner must be a resident of Canada for income tax purposes throughout the taxation year in which the transfer occurs
- The combined interest of all foreign limited partners in the limited partnership must account for less than half of the entitlement of all partners to share in the profits of the limited partnership
Refund for BC Foreign Buyers Tax
You may also be eligible for a refund on the tax if you became a permanent resident or Canadian citizen within one year of the date the property transfer was registered with the Land Title Office.
How to claim an exemption to the BC Foreign Buyers Tax
Please refer to the Government of BC website for more information on claiming an exemption. Details of the BC Foreign Buyers Tax also known as the Additional Property Transfer Tax are in full there. The details may be subject to change so please check the official site for the latest updates.
Want to Learn More?
Check out our blog on the BC Foreign Buyer Tax to learn more about the tax.