The year is 1987 and the Bangles’ “Walk Like An Egyptian” is the top hit on the Billboard 100.  This just so happens to be the same year that Premier Vander Zalm introduces the Property Purchase Tax, now known as Property Transfer Tax (“PTT”).

You’ve purchased a home and/or you’ve acquired an interest in property that just so happens to be registered at the Land Title Office.  Unless you qualify for an exemption, you’re going to have to pay property transfer tax (start saving your pennies).

Property Transfer Tax and is based on the fair market value of your property (land and improvements) on the day it was registered with the Land Title Office (note, it is not necessarily based on the purchase price of the property).  It is calculated as so:

• 1% of the fair market value up to and including $200,000,
• 2% of the fair market value greater than $200,000 and up to and including $2,000,000,
• 3% of the fair market value greater than $2,000,000, and
• For residential properties, there is is also a further 2% payable on the fair market value of residential properties over $3,000,000.

If you’re a foreign national, foreign corporation or taxable trustee, you’ll pay Additional Property Transfer Tax in certain regions of the province, which is a 20% additional tax.

Rest assured, there are exemptions to this pricey fee!  A full list is available here.

A few to note, however, are:

• First Time Home Buyer Exemption (may qualify for a reduction or full exemption) if an eligible property is under $525,000 (full exemption to $500,000) and the purchaser is a qualified individual;
• Newly Built Home Exemption if an eligible property is purchased by an eligible owner and the purchase price is under $800,000 (full exemption to $750,000);
• Survivorship – Transfer to the survivor of a joint tenant as a result of the death of a joint tenant; 
• Executor/Executrix – Transfer to the Executor or Executrix of your Estate; and
• Transfer to a Related Individual provided very specific requirements are met.

Note though, there is not necessarily an exemption for the foreign buyer Additional Property Transfer Tax in the above situations.

PTT and the available exemptions involve many different intricacies and qualifications.  We strongly recommend that you thoroughly investigate these issues with respect to any particular circumstances and seek advice if appropriate.

Give us a call or send us an email if you have any questions; we are here to help!

This information is general in nature only. You should consult a lawyer before acting on any of this information. This information should not be considered as legal advice. To learn more about your real estate needs, please contact our office at (250)448-2637 or any of our lawyers practicing in the area of estate planning at the following:

Una Kuzio: una@touchstone.law

Jane Otterstrom: jane@touchstone.law