Are you a first-time home buyer?? If so that’s super exciting!! There is so much to consider so be sure to use an experience agent who can lead you through the process with no surprises.
When a used residential home is purchased In British Columbia, typically, a tax is due upon completion. This is called the Property Transfer Tax, or also known as the Sunshine Tax. This is calculated as follows:
1% on the 1st $200,000
2% on the portion from $200,000 up to and including $2,000,000
3% on the portion great than $2,000,000 and if the property is residential, a further 2% on the portion greater than $3,000,000.
However, as a First Time Home Buyer just getting into the market, you would get a break on this tax if you qualify for a full exemption. To qualify you must be able to check off the following:
- be a Canadian citizen or permanent resident
- lived in B.C. for 12 consecutive months immediately before the date you purchase or at least 2 income tax returns as a B.C. resident in the last 6 years
- have never owned an interest in a principal residence anywhere in the world at any time
- have never received a first time home buyers’ exemption or refund
and the property must:
- be located in B.C.
- only be used as your principal residence
- have a fair market value (purchase price) of $500,000 or less if registered on or after February 22, 2017
- be 0.5 hectares (1.24 acres) or smaller
If your purchase price is between $500,000 and $525,000, you may be eligible for a partial exemption.
If your purchase price is over $525,000, be prepared to pay the full amount of the glorious Sunshine Tax. Regardless, the benefits of owning a home far exceeds any tax payable.
For more information check out the link
For professional real estate advice, contact Terri Ann Novello, REALTOR® at 250-808-1005.