When buying or selling real estate in British Columbia, it is crucial to be aware of the additional and unexpected costs that can add up through the closing process. A conveyancing cost that tends to be overlooked is Property Transfer Tax. It is imperative to understand Property Transfer Tax in order to be prepared for the extra cost when it is time to close your transaction.
What is Property Transfer Tax?
Conveyancing taxes, also known as Property Transfer Tax, are the taxes charged on the transfer of title to a property in British Columbia and are levied by the Provincial Government. The amount of Property Transfer Tax paid is assessed based upon the fair market value of the property. Property Transfer Tax is levied on any taxable transaction triggered by the transfer of title to a property in British Columbia, from residential homes to commercial real estate.
How do you Calculate Property Transfer Tax?
The amount of Property Transfer Tax for residential properties is calculated as 1% on the first $200,000.00 of the fair market value of the property, 2% on the fair market value of property between $200,000.00 to $2,000,000.00, 3% on the fair market value of the property between $2,000,000.00 to $3,000,000.00, and 5% for the remainder of the fair market value of the property.
If you are in the midst of purchasing or selling a property, or interested in learning more about conveyance taxes, our professional team of real estate lawyers and paralegals has over 50 years of combined experience to assist you with all of your real estate transactions and needs.
Scott Johnston is a proud partner at CBM Lawyers LLP, specializing in business and real estate law. Reach out to Scott or a member of our team to learn more about Property Transfer Tax. Contact Us Today!
