Good day Friends,
Welcome to winter! The Elk Valley is a destination around Canada and the world for employment in resources.
Elkford recently welcomed several families from South Africa for work at EVR. Many of them have been or will soon be looking to buy homes. To help you as consultants in this very important purchase, I have tried to summarize the nuances of New to Canada and First Time Home Buyers programs.
There is much more detail available through the government websites I will link here — this is meant to be a quick note to summarize the most relevant for our new neighbours and their concerns about the Land Transfer Tax.
BC First-Time Home Buyers’ Program
BC has a specific First-Time Home Buyers’ Program that reduces or eliminates the amount of property transfer tax you pay when you purchase your first home.
To qualify for an exemption, at the time the property is registered, you must:
- Be a Canadian citizen or permanent resident
- Lived in B.C. for at least a year immediately before the date you register the property
- Filed at least 2 income tax returns as a B.C. resident in the last 6 taxation years
- If you become a Canadian citizen or permanent resident before the first anniversary of the registration date, you may apply for a refund of the property transfer tax
- Have never owned a registered interest in a property that was your principal residence anywhere in the world at any time This might be tricky to prove, but the penalty for deceit is 2× the property tax owed.
- Have never received a First-Time Home Buyers’ exemption or refund
- If one or more buyers — but only one is a First-Time Home Buyer — their interest in the property can be applied to the rebate i.e., half of the rebate is available if 1 of 2 is a First-Time Home Buyer.
- The property must be your principal residence and be 0.5 hectares (1.24 acres) or smaller
If all the above requirements are met, the purchaser may be exempt from property transfer tax on the first $500,000 of the purchase price of the property.
As this is a government program, the requirements can change. I recommend reviewing with a lawyer. More information can be found at:
First Time Home Buyers Program in BC
| Property Transfer Tax Breakdown | A $650,000 | B $150,000 |
|---|---|---|
| Fair market value of the property Exempt on first $500,000 | $650,000 | $150,000 |
| General property transfer tax 1% of the value up to $200,000 | $2,000 | $1,500 |
| 2% of the value greater than $200,000 Up to and including $2,000,000 | $9,000 | $0 |
| Total property transfer tax payable | $11,000 | $1,500 |
I’m Here to Help
For these and all other questions from your buyers, I am here to help. The New to Canada and buying a home experience can be a challenging and intimidating journey.
We can be an incredible team — you as their guide for finding a home, and me to help make the financing work.
Reach out — I look forward to working with you and your clients.