Property Transfer Tax exemption limit for first-time buyers raised by $50,000
Effective February 19, 2014, the limit for a first time buyer’s exemption to the Property Transfer Tax has been raised by $50,000.
Property Transfer Tax applies to the sale and transfer of all real property in British Columbia, at a rate of 1% of the first $200,000 and 2% of anything above $200,000. It’s an evil tax grab that we’ve all but gotten used to having to pay in BC and a tax that Albertans in particular like to slag when extoling the virtues of their own province (usually, ironically, in the course of moving from Alberta to BC).
We are offered one freebie exemption from paying the tax, the qualifications for which include buying a home to live in (and not rent out), under a certain monetary value, and you have to have never owned a home before anywhere in the world. Hence, the first-time buyers exemption.
The cap on the exemption has been $425,000 for years, with partial tax payable for anything up to $450,000. But with the bump coming into effect tomorrow, there’s an extra $50,000 that can be spent and still avoid the tax.
The new exemption limit is $475,000 to avoid tax altogether. Any property purchased between $475,000 and $500,000 has a reduced percentage of tax applied to it.
This is good news. See the link below for more information.