Property Transfer Tax

The Property Transfer Tax (PTT) is a land registration tax paid by a property buyer or owner when a property title is registered at the Land Title and Survey Authority (LTSA).  How much is the PTT?The PTT is charged on the fair market value of a property at a rate of:
  • 1% on the first $200,000
  • 2% on the balance up to and including $2,000,000
  • 3% on the balance greater than $2,000,000
If the property is transferred without money changing hands – for example, an inheritance, (known as an arm’s length transaction) – the value is determined by an independent appraisal or BC Assessment.Pre-salesBuyers of pre-sold strata units will typically pay the PTT on the total consideration paid for the unit, not the fair market value on the date the title is registered. There are PTT exemptions for new homes (see below.)The total consideration is the entire amount paid to acquire the property, including the price of the unit plus fees for upgrades or additions, or any premiums for the assignment of a written agreement.

Once a developer files a strata plan at the LTSA, whoever registers the transfer pays the PTT. Foreign entities Effective August 2, 2016, an additional PTT charged at a rate of 15% of the fair market value applies to residential property transfers to foreign entites in Metro Vancouver. Foreign entities are transferees that are foreign nationals, corporations or taxable trustees. The additional tax applies on the foreign entity's proportionate share of any applicable residential property transfer, even when the transaction may normally be exempt from the PTT. This includes transactions between related individuals, a transfer resulting from an amalgamation, a transfer to a surviving joint tenant, and a transfer where the transferee is or becomes a trustee in relation to the property, even if the trust does not change. 

The 15% PTT does not apply to trusts that are mutual fund trusts, real estate investment trusts or specified investment flow-through trusts.This 15% PTT applies to “Greater Vancouver Regional District” or “Metro Vancouver” municipalities. The communities included are: Anmore, Belcarra, Bowen Island, Burnaby, Coquitlam, Delta, Langley City and Township, Lion's Bay, Maple Ridge, New Westminster, North Vancouver City and District, Pitt Meadows, Port Coquitlam, Port Moody, Richmond, Surrey, Vancouver, West Vancouver, White Rock and Electoral Area A. Here is a link to a map of these municipalities.ExemptionsFirst Time Home Buyers’ Program The First Time Home Buyers’ (FTHB) Program gives a PTT exemption to eligible first time home buyers.

To qualify for a full exemption, first time buyers must:
  • be a Canadian citizen or permanent resident;
  • have lived in BC for 12 consecutive months before the date the property is registered; or
  • have filed 2 income tax returns as a BC resident in the last 6 years;
  • have never owned an interest in a principal residence anywhere, anytime; and
  • have never received a first time home buyers' exemption or refund.
The property must be used as a principal residence and have a fair market value of $475,000 or less and be 0.5 hectares (1.24 acres) or smaller. There is a partial exemption for properties $475,000 - $500,000Here are details.Newly built homesThere’s a PTT exemption for newly built homes with a fair market value of up to $750,000, including a house constructed on vacant land, a new apartment in a newly built condominium building, a manufactured home on vacant land, and other newly built homes. There are also occupancy requirements

There’s a partial exemption for property with fair market value of $750,000 - $800,000.   To apply for the Newly Built Home Exemption, enter exemption code 49 on the Special Property Transfer Tax Return when the property is registered at a land title office.Vacant landIf you registered a vacant lot and paid the tax, you may apply for a refund if you have:Apply for a refund by completing the Newly Built Home Application for Refund.If you need help, phone 250-387-0604 or toll-free phone Inquiry BC at 604-660-2421 and ask to be transferred to 250-387-0604.Other exemptionsThere are many PTT exemptions, including family exemptions, for example:There are also exemptions for title transfers involving joint tenants and tenants in common, an agreement for sale, a bankruptcy, and transfers to registered charities. Bulletin PTT 003 has details about the range of exemptions.PenaltiesIf buyers don’t comply there are penalties that can be levied.PTT historyIn 1987, the PTT was brought in as a luxury tax. Just 5% of homes were taxed the 2% portion (over $200,000). Today, more than 95% of homes pay the 2% portion.

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Royal LePage Sussex

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