PTT and first time home buyer’s information
What is it?
The Property Transfer Tax is a tax payable to the Provincial Government by purchasers of real estate. The tax applies to all types of real estate, whether residential, commercial or industrial.
How is it calculated?
The amount of the Property Transfer Tax is 1% on the first $200,000.00 of the property’s fair market value, 2% on the amount between $200,000 and $2,000,000, and 3% of the remaining fair market value.
For example, if the fair market value of the property is:
$200,000.00, the tax payable would be $2,000.00 (1% of $200,000.00).
$800,000, the tax payable would be $14,000 (1% on the first $200,000.00 = $2,000.00 and 2% on the remaining $600,000.00 = $12,000.00)
$2,400,000, the tax payable would be $50,000 (1% on the first $200,000.00 = $2,000.00, 2% on $1,800,000) = $36,000, 3% on $400,000 = $12,000)
What is Fair Market Value?
“Fair Market Value” is best described as the price that would be paid for a property on the open market (which is usually the actual purchase price paid for the property).
How does a buyer qualify for the First Time Home Buyers Exemption?
To qualify as a First Time Home Buyer and avoid paying the PTT, the following criteria must be met:
How does a buyer qualify for the Newly Built Home Exemption?
To qualify for the Newly Built Home Exemption and avoid paying the PTT, the following criteria must be met:
Are there other exemptions?
Yes, such as a transfer of a principal residence between family members. For details on this and other exemptions, go to http://www.rev.gov.bc.ca/RPT/ and pick the “Property Transfer Tax” button located on the right hand side on this screen.
Property Transfer Tax should not be confused with Property Tax. The Property Transfer Tax is a one time tax paid to the Provincial Government by purchasers of real estate. The Property Tax is the tax paid on an annual basis to the local City/Municipality.
Please remember that the Property Transfer Tax Act may frequently change along with the exemptions for payment of this Tax. While we try to keep our website up to date as much as possible, please do not rely upon the information without talking to one of our lawyers.
The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult a lawyer for individual advice regarding your own situation.
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