Property Transfer Tax When Buying a BC Business With Real Estate

If the business you want to buy owns land or buildings, the purchase involves more than equipment and goodwill. A real estate component can bring transfer taxes, extra searches and extra contract requirements.

This article does not set out property transfer tax rates, thresholds or exemptions. Those turn on the facts and the current rules, so a lawyer or accountant should confirm them for your deal. What follows explains how the structure of the purchase and the related checks fit around that question.

This article covers the law of British Columbia.

Why structure matters

You can buy a business by buying its assets or by buying the shares of the company that owns them. In an asset purchase the price must be allocated to each asset at fair market value, with the remaining balance attributed to goodwill. Land and buildings would be one of those assets, so the value given to them is a real number with tax consequences.

In a share purchase, a change in share ownership does not change the tax values of the corporation's assets, and share purchases are generally not subject to GST/HST. The buyer takes the company with its history and liabilities. Whether a share purchase of a land-owning company triggers property transfer tax is a separate question to put to your lawyer before you settle on the structure.

Other taxes that touch real property

Real property is non-taxable for PST on an asset sale. For GST/HST, the seller and buyer may jointly elect on Form GST44 so that no GST/HST is payable, when the buyer acquires all or substantially all (at least 90%) of the property needed to carry on the business. The election is unavailable where the supplier is a registrant and the recipient is not. Even with the election, GST/HST can still apply to certain services, leases and licences, and to sales of real property where the recipient is not a registrant.

If the seller is not a resident of Canada, a purchaser of taxable Canadian property may have to remit 25% of the amount by which the cost exceeds the certificate limit, within 30 days after the end of the month of acquisition. A purchaser is not liable under s.116(5) if, after reasonable inquiry, it had no reason to believe the seller was not resident in Canada, if a treaty-protected property rule applies under s.116(5.01), or if the Minister issued a s.116(4) certificate.

Searches before you close

A Land Title Office title search costs $11.06 (as at April 1, 2026). Searches through an LTSA account carry a separate electronic transaction fee of $3.55 ($2.20 for prepaid accounts), plus GST.

A regular title search may miss a builders' lien submitted for registration the same day but not yet registered, so lenders and buyers' lawyers often order a separate after-3:00 p.m. search. Property searches cover land only, not equipment or inventory.

For equipment, inventory and receivables, a Personal Property Registry search is the usual check. A PPR search alone does not reveal every lien, because builders' liens, family maintenance liens and some others are filed with other agencies.

Land in the contract

A contract respecting land or a disposition of land is not enforceable unless there is a signed writing, an act or acquiescence by the party to be held, or reasonable reliance making enforcement necessary to avoid unfairness. Paying or accepting a deposit or part payment counts as such an act.

If a deposit is at risk of being lost, a buyer or seller facing forfeiture may ask a BC court for relief, and the court may relieve against penalties and forfeitures on terms it sees fit.

What to do next

• Ask the seller whether the company or an individual owns the land, and get a title search.
• Have a lawyer confirm whether property transfer tax applies to your structure and to the value of the land.
• Compare an asset purchase with a share purchase, with your accountant, before you sign.
• Agree in writing on the value given to the land and buildings.
• Order the PPR search and an after-3:00 p.m. title search close to closing.
• Build the tax costs into your closing budget.

Frequently asked questions