Property Transfer Tax – what is it and who pays?

Published By: on October 24th, 2011 in Category Nanaimo Real Estate News
Published By: on October 24th, 2011 in Category Nanaimo Real Estate News

Property transfer tax (PTT)is a nasty surprise to some home buyers new to B.C. There are similar taxes charged in all provinces, however ours in B.C. is the 2nd highest in the country. It is calculated like this: 1% on the 1st $200,000 and 2% on the balance. I think the idea is that any property over $200,000 is a luxury property and thus should be subject to a higher tax rate. Hmmm. Has anyone looked at the average house price in B.C. lately? This $200,000 breakpoint is looking a bit out of date.

PTT is charged to the buyer in all transactions involving transfer of title from one owner to another. However, 1st time homebuyers are exempt. In order to qualify for the exemption you need to have never owned a property anywhere in the world at any time in your life. Each individual has the right to claim this exemption, so if one partner has owned a property before and the other has not, you can claim a percentage of the exemption based on the percentage of your ownership. For example, if you own 50% of your new property then you can claim 50% of the exemption.

PTT is based on the “fair market value” of the property – usually the sale price. If the price paid for the property is not considered fair market value, for example if it was gifted to a family member, then the value would be set at the assessment level plus improvements. The point here is that the government gets its money one way or the other.

Testimonials

Marie and LOVE Real Estate Team are simply the best. Marie’s excellent advice, knowledge of all things house-related, her attention to detail, and outstanding commitment all factored into us getting the house of our dreams!

Throughout our experience working with Marie, she demonstrated her integrity time and again through her dealings with us and with other realtors. Throughout the process of looking for and purchasing our new home, she was patient, understanding, and an absolute pleasure to work with. We have come to trust her completely and we would highly recommend her to anyone.

Chris and Miki Flynn

We had been planning a move from Calgary to Nanaimo for retirement purposes for a few years. Upon discovering Love Real Estate Group a relationship began. Over a period of time, with patience, professionalism, good humour and integrity, Love Real Estate Group helped us secure a home that met our needs and our wishes. We are happy to recommend Love Real Estate Group to anyone looking to buy a property in the Nanaimo area.

Diane and Tom Crawford