Property Transfer Tax on Vancouver Real Estate
Updated October 2018
Property transfer tax is charged when you purchase a Vancouver home or make changes to a property’s title, including:
- acquiring a registered interest in the property
- gaining an additional registered interest in the property
- becoming the registered holder of a lease, life estate, or right to purchase for the property
The amount of transfer tax you pay is based on the fair market value of the land and improvements (e.g. buildings) on the date of registration unless you purchase a pre-sold strata unit. The tax is charged at a rate of:
- 1% on the first $200,000,
- 2% on the portion of the fair market value greater than $200,000 and up to and including $2,000,000, and
- 3% on the portion of the fair market value greater than $2,000,000.
- If the property is residential, a further 2% on the portion of the fair market value greater than $3,000,000 (effective February 21, 2018).
- if the purchase price of a property is $450,000, the transfer tax is $7,000.
- If the purchase price of a property is $700,000, the transfer tax is $12,000
- if the purchase of a property is $2,000,000, the transfer tax is $38,000
If you’re a foreign national or foreign corporation and the residential property is located in the Greater Vancouver Regional District, you also pay the 15% additional property transfer tax on the fair market value of your proportionate share. To see if you are a foreign national follow this link.
BC has also introduced a Speculation and Vacancy tax. Visit the BC government website to view the exemptions to the Tax.
For 2018, the tax will be levied at:
- 0.5% of the property’s assessed value for all properties subject to the tax
For 2019 and subsequent years, the tax will be levied at:
- 2% for foreign owners and satellite families
- 0.5% for British Columbians and other Canadian* citizens or permanent residents who are not members of a satellite family
Follow this link to use The Property Transfer Tax Calculator
Property Transfer Tax Exemptions – First Time Home Buyers
The First Time Home Buyers’ Program reduces or eliminates the amount of property transfer tax you pay when you purchase your first home. If you qualify for the program, you may be eligible for either a full or partial exemption from the tax.
If one or more of the purchasers of the property do not qualify, only the percentage of interest that the first time home buyer(s) have in the property is eligible.
For example, if you purchase a property at a value of $400,000 with a person who doesn’t qualify you would still qualify on your share. If you owned a 50% interest in the property, 50% of the tax amount would be eligible for the exemption.
The exemption doesn’t apply to the additional property transfer tax on residential transfers to foreign nationals or foreign corporations. Follow this link for more information on the foreign tax.
Do You Qualify?
To qualify for a full exemption, at the time the property is registered/purchased you must:
- be a Canadian citizen or permanent resident
- have lived in B.C. for 12 consecutive months immediately before the date you register the property or filed at least 2 income tax returns as a B.C. resident in the last 6 years
- have never owned an interest in a principal residence anywhere in the world at any time
- have never received a first time home buyers’ exemption or refund
and the property must:
- be located in B.C.
- only be used as your principal residence
have a fair market value of:
- $425,000 or less if registered on or before February 18, 2014, or
- $475,000 or less if registered on or after February 19, 2014
- be 0.5 hectares (1.24 acres) or smaller
You may qualify for a partial exemption from the tax if the property:
- has a fair market value less than:
- $450,000 if registered on or before February 18, 2014, or
- $500,000 if registered on or after February 19, 2014
- is larger than 0.5 hectares
- has another building on the property other than the principal residence
Follow this link to find out the amount of your exemption if you qualify.
If you don’t qualify because you are not a Canadian citizen or permanent resident, but you become one within 12 months of when the property is registered, you may apply for a refund of the property transfer tax. To apply for a property transfer tax refund in this case, call (250) 387-0604. However, if you’re a foreign national or foreign corporation, you can’t be refunded any additional property transfer tax you may have paid.
Applying For Exemptions
To apply for the First Time Home Buyers’ Program you need to complete the First Time Home Buyers’ Property Transfer Tax Return when your lawyer or notary register the property transfer.
After you have applied you must meet additional requirements during the first year you own the property to keep the tax exemption.
There are Serious Penalties for False Declaration
All applications are reviewed. You will be charged a penalty equal to double the tax if you falsely declare that:
- you have never owned an interest in a principal residence anywhere in the world at any time, or
- you have never received a first time home buyers’ exemption or refund
First Year of Ownership
At the end of the first year you own the property you will receive a letter. The letter is to conditionally confirm that you meet the occupancy and property value requirements after you:
- purchased an existing home, or
- purchased vacant land and built a home
More Questions about BC taxes? Contact Leo now