Property Transfer Tax Rates

The amount of tax due depends on the fair market value of the property that is transferred:

• If the fair market value is $200,000 or less, the tax is 1% of the fair market value.
• If the fair market value is greater than $200,000, the tax is 1% of the fair market value up to $200,000, plus 2% on the portion of the fair market value that is greater than $200,000.

For example:

• if fair market value of property is $150,000
  tax payable is: 1% of $150,000 = $1,500
  
  
• if fair market value of property is $250,000
  tax payable is: 1% of $200,000 = $2,000
  plus 2% of $50,000 = $1,000
  for total tax payable of $3,000

First Time Home Buyers' Program

Introduced in 1994, the First Time Home Buyers' Program is designed to help British Columbians purchase their first home. Under the program, eligible purchasers can claim an exemption from Property Transfer Tax if the fair market value of the home is less than the threshold amount.

For registrations on, or after, February 20 2008, the fair market value threshold for eligible residential property is $425,000.

A proportional exemption is provided for eligible residences with a fair market value of up to $25,000 above the threshold (i.e. up to $450,000).

To qualify for the First Time Home Buyers' exemption you must meet all of the initial eligibility criteria. To retain the exemption, there are also requirements which must be met in the year following the transfer. For a general overview of the eligibility criteria, please see the brochure, Property Transfer Tax and the First Time Home Buyers' Program. For complete information on all of the eligibility criteria, please see:

• Bulletin PTT 004, First Time Home Buyers' Program
• Instructions for Completion of the First Time Home Buyers' Tax Return
• First Time Home Buyers' Program - Follow Up

To claim the exemption you must file a First Time Home Buyers' Property Transfer Tax Return (FIN 269) and the appropriate Land Title forms at the Land Title Office when you apply to register your property.

If a purchaser did not apply for the exemption when the transfer was originally registered at the Land Title office, but met all the FTHB eligibility criteria at that time, the purchaser may apply for a refund within the first 18 months from the date of the original registration. Please see How to File for more information.

Exemptions

In addition to the First Time Home Buyers' Program, there are a number of exemptions that may apply to the transfer of property, exempting all or a portion of the transfer from Property Transfer Tax.

If you are claiming any of these exemptions, you need to file a Special Property Transfer Tax Return (FIN 579S) and use the exemption code provided in the respective bulletin.

If you are claiming more than one exemption, claim code 00 in the Special Property Transfer Tax Return, and attach a letter to the return with the details of the circumstances of the transfer.

A number of commonly claimed exemptions are outlined in Bulletin PTT 003, Property Transfer Tax Exemptions:

• net interest passing
• transfers involving joint tenants and tenants in common
• transfers involving an agreement for sale
• transfers following bankruptcy
• transfers resulting from marriage breakdowns
• transfers to registered charities (also see Bulletin PTT 025)
• transfers under the Veterans' Land Act (Canada)
• transfers by which property escheats, reverts or forfeits to the Crown, or where the property is returned
• transfers to municipalities and other local governments

There are also a number of bulletins regarding specific exemptions and their limitations, as listed below:

Transfers of property between related individuals or other family members:

• Exemptions for the Transfer of a Principal Residence (PTT 005)
• Exemptions for the Transfer of a Recreational Residence (PTT 007)
• Exemptions for Transferring a Family Farm (PTT 008)
• Exemptions for Transfers to and from a Family Farm Corporation (PTT 009)

Subdivision of property:

• Exemptions for Transfers in the Course of Subdivisions (PTT 006)

Transfers to and from trust companies or the Public Trustee:

• Exemption for Transfers to and from Trust Companies or the Public Trustee
  (PTT 010)

Transfers to correct conveyancing errors:

• Exemption for Transfers Correcting Conveyancing Errors
  (PTT 011)

Transfers in respect of an amalgamation:

• Exemption for Transfers in Respect of an Amalgamation
  (PTT 012)

Leases and options to lease of less than 30 years:

• Application of the Act to Multiple Leases in Respect of the Same Land (PTT 015)

Transfers of reserve or surrendered land, or to the Nisga'a Nation:

• Application of the Act to Status Indians and Indian Bands
  (PTT 017)

Transfers on behalf of minors:

Exemptions to Minors for Transfers to and from the Public Guardian and Trustee (PTT 026)

 

About Property Transfer Tax

Property Transfer Tax is a land registration tax. It must be paid when an application for a taxable transaction is made at any Land Title Office in British Columbia to register changes to a certificate of title. Property Transfer Tax is payable on the fair market value of the property being transferred. More information on taxable interests is available here.

Fair market value is the price that would be paid by a willing purchaser to a willing seller in the open market on the date of registration. An open market is where the property is offered for sale so that anyone likely to be interested in purchasing it may make an offer. For example, the seller lists the property with a realtor or advertises it for sale. If your tax return is reviewed by this office, you may be asked to provide evidence of how you knew the property was for sale.

In most open market transactions, the purchase price is the fair market value, as long as the transfer is registered within a few months after the sales contract is signed. In other instances, such as where no money changes hands or the transfer did not take place in the open market, the fair market value must be determined by other means, such as an independent appraisal or by reference to the most relevant BC Assessment value.

Generally BC Assessment property assessments reflect fair market value as at
July 1 of the previous year. For example, assessed values for the 2011 tax year are based on what the property would have sold for in the open market as at July 1, 2010. This means that the assessed value may not reflect the current market value of your property at the date of registration. Because of this and the fact that property markets can change rapidly, you may need a more recent valuation, such as an independent appraisal, of what the property is worth at the time of registration.

There are other situations when the BC Assessment value does not reflect the current fair market value including when the land is classified as farm land by BC Assessment or there have been changes affecting fair market value since the BC Assessment value was determined i.e. trends in a local area, addition of services, partial/new construction or rezoning.

Under the Interpretation Act, land means any interest in land, including any right, title or estate in it of any tenure, with buildings and houses, unless there are words to exclude buildings and houses or to restrict the meaning. Because there is no limiting definition in the Property Transfer Tax Act, tax is payable on the fair market value of the land, plus all improvements on that land at the time of registration.

The following are examples of common improvements to land that are included in the fair market value of the property:  houses; manufactured homes or modular homes; garages; sheds or other outbuildings; paving, such as driveways; utilities, such as sewer; and timber.

Further information about the application of property transfer tax to the registration of manufactured, mobile, or modular homes can be found under Frequently Asked Questions.

You are required to pay Property Transfer Tax unless you qualify for an exemption.