Blog
2016 BC Budget Changes Property Transfer Tax
by Lisa Niro
The BC government released the new budget for 2016 today. The budget contains three major changes to the current Property Transfer Tax (PTT) regime. Two of the changes are effective immediately and one change is being proposed for implementation.
Here are the changes that are effective as of February 17, 2016:
- New PTT exemption for most purchasers of newly built homes (including condominiums); and
- Increased PTT on properties with a fair market value over $2,000,000.
The government is proposing to make amendments to British Columbia’s Property Transfer Tax Act to provide for the collection and disclosure of the following information whenever a property is purchased:
- Disclosure of citizenship and beneficial ownership.
New PTT Exemption
Newly built homes including condominiums will now receive a PTT exemption if the fair market value of the property is below $750,000. There will be a partial exemption for newly constructed homes under $800,000.
This program will be available to most purchasers, including new residents of BC, first-time homebuyers and previous property owners. To qualify for the exemption, the property must be 1.24 acres or less, you must be a Canadian citizen or permanent resident, you must move into the home within 92 days following registration at the Land Title Office, and you must continue to occupy the property as your principal residence for the remainder of the first year.
For more information, take a look at the government of British Columbia’s website (opens new tab).
Increased PTT on properties over $2,000,000
Properties with a fair market value over $2,000,000 will now pay PTT based on the following rates:
- 1% on the first $200,000;
- 2% on the portion greater than $200,000 up to and including $2,000,000; and
- 3% on the portion greater than $2,000,000.
This is an increase of 1% on the portion of the fair market value over $2,000,000.
Disclosure requirements for Citizenship and Beneficial Ownership
Coming in effect in Spring 2016 there will be new disclosure requirements relating to the citizenship of purchasers. Additionally there is a proposal for mandatory disclosure relating to whether or not a purchaser (bare trustee) is holding the property for the benefit of another individual (beneficial owner) under a bare trust agreement.