- The person receiving the property files the return and pays any tax, even when the transaction is exempt.
- A transfer for little or no money is still measured against fair market value, not just the price on the paperwork.
- Several exemptions, including one for marriage breakdown, are claimed with an exemption code or a separate form such as PTT-003.
Families often move a home between people without a typical sale: a parent to a child, one spouse to the other, or among relatives. The price may be a dollar, a gift, or a payment well below market. In British Columbia, that does not automatically mean no property transfer tax (PTT).
This article walks through how PTT generally applies to family transfers, what value is used, and which exemptions are worth asking about. The answer in your case depends on the details, so a lawyer should confirm it before anything is registered.
This article covers the law of British Columbia.
The starting point: who owes tax and when
PTT is paid by the buyer, called the transferee, when applying to register a taxable transaction at a land title office. A return must be filed whether or not the transaction is exempt. In a family transfer, the relative receiving the home is the one who files.
The return and payment are usually handled by a legal professional at the time of registration. The Land Title Office may refuse registration if tax is not paid on the registration date.
Why a low price does not settle the question
Tax is charged on fair market value: the price a willing buyer would pay a willing seller in the open market on the registration date. The purchase price may not match that value if the transfer was not an open-market sale.
For non-open-market transfers, the ministry points to a recent independent appraisal or the BC Assessment value. Assessment values reflect the market on July 1 of the prior year and condition on October 31, so they can be out of date, and should not be used after rezoning, market changes or new construction, or for farm class 9 land.
| Fair market value | General rate on that portion |
|---|---|
| Up to and including $200,000 | 1% |
| Above $200,000 up to and including $2,000,000 | 2% |
| Above $2,000,000 | 3% |
| Residential value above $3,000,000 | A further 2% |
For example, on a $500,000 value the general tax is $2,000 plus $6,000, totalling $8,000.
Exemptions to ask about
Exemptions are claimed on the return using an exemption code. Some use separate forms: PTT-003 covers marriage breakdown, agreements for sale, joint tenancy to tenancy in common, and bankruptcy. Other possibilities in a family setting include these.
- Marriage breakdown: a transfer between separating spouses may be claimed using form PTT-003.
- Surviving joint tenant: an individual can file through the LTSA 'Transmission to Surviving Joint Tenant' online application without a legal professional, but this exemption does not apply to the additional PTT.
- First time home buyers' exemption: a relative receiving the home may qualify if they meet the eligibility and property conditions.
- Newly built home exemption: this applies only to a first-registered, newly built home, so it will rarely fit a typical family transfer.
If a first time home buyers' exemption has been claimed, a death of the owner, or a transfer under a separation agreement or Family Law Act court order before the first anniversary, does not disqualify the claim.
Additional taxes and traps
If the person receiving the home is a foreign national, a foreign corporation or a taxable trustee, additional PTT may apply to the residential portion of their proportionate share in the Capital Regional District, Fraser Valley Regional District, Metro Vancouver Regional District, Regional District of Central Okanagan and Regional District of Nanaimo. The rate and the date it took effect are worth confirming with a lawyer before you rely on any figure. A confirmed B.C. Provincial Nominee buying a principal residence may be exempt, but their family members are not exempt and pay on their proportionate share if they are also foreign nationals.
The BC home flipping tax can apply to a disposition of taxable residential property owned for less than 730 days. Dispositions between related persons are exempt only if a return is filed.
Misleading information can lead to the corrected tax plus a penalty equal to the amount correctly paid, and returns can be audited within six years from registration.
What to do next
- Decide who is receiving the property and in what shares.
- Obtain a recent independent appraisal or the current BC Assessment notice.
- Confirm each receiving person's citizenship or immigration status.
- Ask which exemption code or form, if any, applies.
- Confirm with a lawyer before the transfer is signed and registered.
If an eligible exemption was not claimed at registration, a refund may sometimes be sought, though time limits apply and differ by exemption. It is easier to claim it correctly the first time.
Frequently asked questions
Is a gift of a house to my child free of PTT?
Not automatically. A return must be filed whether or not the transaction is exempt, and tax is based on fair market value rather than only the price paid. Whether an exemption applies depends on the facts.
What value is used if no money changes hands?
For non-open-market transfers, the ministry points to a recent independent appraisal or the BC Assessment value. BC Assessment values can lag current value.
Is there an exemption when spouses separate?
Form PTT-003 covers marriage breakdown transfers. A lawyer can confirm whether your agreement or order fits.
Who actually files the return?
The buyer or their legal professional files and pays at the Land Title Office when the transfer is registered, and legal professionals usually do this.
Sources
- gov.bc.ca – Property transfer tax — www2.gov.bc.ca
- BC Laws – Property Transfer Tax Act — bclaws.gov.bc.ca
- gov.bc.ca – File and pay property transfer tax — www2.gov.bc.ca
- gov.bc.ca – Property transfer tax exemptions — www2.gov.bc.ca
- gov.bc.ca – Newly built home exemption — www2.gov.bc.ca
- gov.bc.ca – First time home buyers' exemption — www2.gov.bc.ca
- gov.bc.ca – Additional property transfer tax — www2.gov.bc.ca
- gov.bc.ca – BC home flipping tax — www2.gov.bc.ca
Links go to official government, court and regulator pages. The law changes — confirm you are reading the current version.
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