The BC government today modified and extended the Property Transfer Tax regime within the province.
- The rate of PTT applied to the portion of the purchase price over $3MM has now been increased to 5% (technically released as a 2% surcharge)
- The rate of APTT (Foreign Buyers Tax) has been increased to 20%
- The areas affected by the APTT (Foreign Buyers Tax) now include:
- Greater Vancouver Regional District
- Capital Regional District
- Central Okanagan Regional District (map)
- Fraser Valley Regional District
- Regional District of Nanaimo
- The have extended the application of the General Anti-Avoidance Rule (GARR) to the PTT (but stopped short of saying that beneficial transfers are subject to the tax).
- Penalties for non-compliance were increased
The government budget release can be found here.
Of note, the major ski areas of Big White (which lies in the Kootenay Boundary Regional District) and Whistler where not effected by the extension of the APTT.
—– FAQ Update —-
I’ve had some great questions tonight from many of you on the changes PTT changes so I thought I would share with all.
- Where can I find the information?
- I have updated bcrealestatelaw.com with the latest info (here)
- When do these changes apply?
- Tomorrow – yes, any transaction which closes on or after FEB 21 will be effected.
- Will the change to APTT (foreign buyers tax) effect Big White?
- No. Big White is outside of the CORD – it is located in Kootenay Boundary Regional District (which I always thought was weird, but now I am grateful for).
- Does this apply to all properties?
- The APTT (Foreign Buyers Tax) will only apply to properties which have a “class 1” residential improvement – so this could also include a farm or commercial property that has a residential component with tax payable on the value of that improvement (if you don’t know how to pull a BC Assessment search give me a call, its really easily done on BC Online).
- Where are the Central Okanagan Regional District boundaries?
- It starts just south of Antlers Beach in Peachland and runs the valley north to boundary of Campbel Brown provincial park on Kalamalka Lake, it runs east as far as the Big White road turn off (but, again does not include Big White).
- Was there any other tax changes?
- Yes, the government also increased the normal PTT on properties over $3MM to 5% (from 3%) on that portion of the purchase price. If you have waterfront buyers, they need to be aware of this important change.
- Can we plan around it?
- The government has tried to close any loopholes, and although they stopped short of taxing changes in beneficial ownership, they have applied the General Anti-Avoidance Rule broadly to the legislation and they have increased the penalties.
Written by Kelowna Real Estate Lawyer Peter Borszcz