Can I Buy a House in BC Through a Company or Corporation?
This answer covers the law of British Columbia.
Buying through a company can change your tax and reporting obligations compared with buying in your own name, and the effects depend on who owns and controls the company.
On tax, BC's additional property transfer tax is 20% of the fair market value of the buyer's proportionate share of the residential portion of a property in a specified area, and it applies to foreign nationals, foreign corporations and taxable trustees. A foreign corporation is one not incorporated in Canada, or a Canadian corporation controlled by foreign entities unless its shares are listed on a Canadian stock exchange. The federal foreign-buyer ban also treats certain corporations as non-Canadian. Base property transfer tax rates start at 1% of fair market value up to $200,000.
On reporting, a transferee applying to register an interest in land must file a transparency declaration, and a transparency report is required only if the future registered owner is a reporting body such as a corporation. Administrative penalties for leaving out required information or giving false information can reach the greater of $25,000 for individuals or $50,000 for other persons, or 5% of the property's assessed value. Title and mortgage terms depend on your lender and facts, so confirm them with a lawyer.
Key takeaways
- BC's additional property transfer tax is 20% of the buyer's proportionate share of the residential portion in a specified area, and it applies to foreign corporations.
- A foreign corporation includes one not incorporated in Canada, or a Canadian corporation controlled by foreign entities unless its shares are listed on a Canadian stock exchange.
- A transparency report is required only if the future registered owner is a reporting body such as a corporation, trustee of a relevant trust or partner of a relevant partnership.
- Administrative penalties for leaving out or misstating required information can reach the greater of $25,000 for individuals or $50,000 for other persons, or 5% of assessed value.