- Property transfer tax has base rates of 1%, 2% and 3% on slices of fair market value, plus 2% on residential value above $3,000,000.
- Foreign buyers can face a 20% additional tax in specified areas.
- GST and income tax on a rental or flip depend on your plans, so confirm them with an accountant.
Buying a resale home to rent out or flip involves more than the price and the mortgage. Several taxes, filings and rules can apply when you register the purchase, and some depend on who you are and how you hold title.
This article lists the main items that BC buyers should check. It does not replace advice on GST or income tax, which depend on how you use the property and are worth confirming with an accountant.
This article covers the law of British Columbia.
Property transfer tax
How and when property transfer tax is paid on your purchase depends on your situation, so it is worth confirming with a lawyer. The base rates are 1% of fair market value up to $200,000, 2% on the portion over $200,000 up to $2,000,000, and 3% on the portion over $2,000,000. Section 3.01 of the Property Transfer Tax Act adds a further 2% on the residential value above $3,000,000.
A registered owner is treated as the legal and beneficial owner for tax calculation even if the person holds the land in trust. Arrangements designed only to avoid tax can be dealt with under an anti-avoidance rule.
Additional tax for foreign buyers
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. It applies to foreign nationals, foreign corporations and taxable trustees. The specified areas are the Capital Regional District, Fraser Valley Regional District, Metro Vancouver Regional District, Regional District of Central Okanagan and Regional District of Nanaimo.
A taxable trustee includes a trustee of a trust with a foreign-entity trustee, or a foreign beneficiary holding a beneficial interest in the residential property. If title is shared with a Canadian citizen or permanent resident, only the foreign buyer's share is taxed. Exceptions include a confirmed BC Provincial Nominee who is registering the transfer as an individual and will use the property as a principal residence, which can be claimed only once, and family members who are foreign nationals do not get it.
Other rules that can affect an investor
| Item | What to know |
|---|---|
| Federal foreign buyer ban | Bars non-Canadians from buying residential property, with exceptions; a fine of up to $10,000 can apply |
| Land Owner Transparency Act | A transferee applying to register an interest must file a transparency declaration |
| Speculation and vacancy tax | Owners in taxable areas must declare every year by March 31 |
| Underused Housing Tax | No return needed for 2025 and later; 2022 to 2024 still apply |
If you buy through a corporation, trust or partnership, a transparency report is required only if the future registered owner is a reporting body. Leaving required information out of a declaration or report can bring a penalty, with a maximum of the greater of $25,000 for individuals or $50,000 for other persons, or 5% of the property's assessed value.
GST and income tax
Whether GST applies to a resale purchase, and how rental income or a flip profit is taxed, depends on who sells, how you use the property and how long you hold it. These are areas where a general article cannot give a safe answer. An accountant can explain how income from renting or reselling is reported, and whether any rebate or credit is relevant.
What to do next
- Decide whether you will hold title personally, through a corporation or through a trust.
- Confirm whether any buyer is a foreign national, foreign corporation or taxable trustee.
- Estimate property transfer tax using the base rates and any additional tax.
- Ask your lawyer about the transparency declaration or report.
- Check whether the property is in an area where the speculation and vacancy tax declaration applies.
- Speak with an accountant about GST and income tax before you remove conditions.
Frequently asked questions
How much property transfer tax will I pay on a resale home?
The base rates are 1% up to $200,000, 2% on the portion over $200,000 up to $2,000,000, and 3% above $2,000,000. A further 2% applies to the residential value above $3,000,000.
Is there extra tax if I am not a Canadian citizen?
Foreign nationals, foreign corporations and taxable trustees can pay an additional 20% on the buyer's share of residential property in a specified area. Some exceptions exist, so confirm your status.
Do I have to file a Land Owner Transparency Act declaration?
A transferee applying to register an interest in land must file a transparency declaration. A transparency report is required only if the future registered owner is a reporting body.
Do I owe tax when I rent out or flip the home?
Income from renting or selling is generally a tax matter for you and your accountant. How it applies depends on your facts, so get advice before you buy.
Sources
- Justice Laws – Prohibition on the Purchase of Residential Property by Non-Canadians Act — Justice Laws (federal)
- Province of BC – Additional property transfer tax for foreign entities and taxable trustees — www2.gov.bc.ca
- BC Laws – Property Transfer Tax Act — bclaws.gov.bc.ca
- LTSA – Learn about LOTR — ltsa.ca
- Province of BC – Enforcing the Land Owner Transparency Act — www2.gov.bc.ca
- CRA – Questions and Answers on the Underused Housing Tax — canada.ca
- CRA – Introduction to the Underused Housing Tax — canada.ca
- Province of BC – Speculation and vacancy 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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A home purchase with us is from $1,900.88, tax included. Third-party fees are extra.