What are the taxes on Housing In BC

What are the taxes on Housing In BC

Postby AlienSoldier » Aug 14th, 2019, 8:00 am

Recently I was asked to invest in a new development in BC, but due to me working in various parts of the country and also most of my income coming from Ontario I was fearful of the taxes that might apply. This included the foreign buyers tax, the speculation tax, etc.

Since many of them are new, I was lost as to where to find information, and did not get clear answers from realtors. Would anyone know what taxes would apply if you were to buy a second home in Kelowna and are Canadian? What would those taxes look like?

I understand the regular ones, property tax, etc. Just what are the new ones.
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Re: What are the taxes on Housing In BC

Postby Gilchy » Aug 14th, 2019, 8:39 am

Foreign buyers' tax won't apply (as long as you're a Cdn Resident), but you potentially could have to pay speculation of 0.5% of the property value annually, unless the property is rented for at least 6 months of the year.

https://www2.gov.bc.ca/gov/content/taxes/property-taxes/speculation-and-vacancy-tax
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Re: What are the taxes on Housing In BC

Postby AlienSoldier » Aug 14th, 2019, 9:31 am

That was perfect.

Hmm, I might have to wait a while then. Do not really feel like paying the vacancy tax, and don't want to rent out a place if I can't be there to look after it.
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Re: What are the taxes on Housing In BC

Postby kgcayenne » Aug 14th, 2019, 9:43 am

Doesn't the spec tax applies only to certain regions in BC?

Mmmmhmmmm:
https://www2.gov.bc.ca/gov/content/taxe ... le-regions
excerpt:
Taxable Regions for Speculation and Vacancy Tax

Only those owning residential property located in a designated taxable region in B.C. must complete a declaration for the speculation and vacancy tax.

Following are the designated taxable regions, including maps for each region. The maps are for your convenience only. Please refer to the legislation for details.

  • Municipalities within the Capital Regional District. This excludes Salt Spring Island, Juan de Fuca Electoral Area, and the Southern Gulf Islands
  • Municipalities within the Metro Vancouver Regional District, excluding Bowen Island, the Village of Lions Bay and Electoral Area A, but including UBC and the University Endowment Lands
  • The City of Abbotsford
  • The District of Mission
  • The City of Chilliwack
  • The City of Kelowna
  • The City of West Kelowna
  • The City of Nanaimo
  • The District of Lantzville

Reserve lands, treaty lands and lands of self-governing Indigenous Nations are not part of the taxable regions.
Islands that are accessible only by air or water are not part of the taxable regions.
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Re: What are the taxes on Housing In BC

Postby AlienSoldier » Aug 14th, 2019, 10:25 am

If I was to buy another property, it would be in Kelowna. I like being close to city centres.

The government website stated that this is to get people from outside of BC to pay taxes in BC. I disagree with this due to:
1. You pay taxes when you purchase property.
2. You pay property tax every year, even if you don't use the residence.

Does that not mean I pay more in taxes than the services I get?
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Re: What are the taxes on Housing In BC

Postby Gilchy » Aug 14th, 2019, 10:32 am

It's intended to increase available housing supply in areas that have a relatively large amount of empty or vacation properties, and to temper rampant inflation and speculation on housing prices.

Whether this is an effective way to do this, and how it can scare off people from bringing outside investment dollars and spending into the local economy, is another story.
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Re: What are the taxes on Housing In BC

Postby kgcayenne » Aug 14th, 2019, 10:46 am

Maybe it is compensating for the fact that with nobody living in the unit there is no contribution (in all likelihood) to federal and provincial income taxes (and therefore any Fed. equalization payments).

Demographics can be way, way skewed from 'actual' because of secondary, unoccupied homes. I learned this while working in retail management. How the heck would I have learned that from working in the Mall in the 90s? Well, having to explain to a Montreal head office of a ladies' clothing chain that no, there are not a whack of a certain demographic living in Kelowna. The millionaires don't stay here, they just play here. Also, snowbirds are here only for a portion of the year, and that's why our sales were not reflecting what the head office projected they should be. The Montreal head office had little understanding of who their customers actually were.
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Re: What are the taxes on Housing In BC

Postby AlienSoldier » Aug 14th, 2019, 11:19 am

kgcayenne wrote:Maybe it is compensating for the fact that with nobody living in the unit there is no contribution (in all likelihood) to federal and provincial income taxes (and therefore any Fed. equalization payments).

Demographics can be way, way skewed from 'actual' because of secondary, unoccupied homes. I learned this while working in retail management. How the heck would I have learned that from working in the Mall in the 90s? Well, having to explain to a Montreal head office of a ladies' clothing chain that no, there are not a whack of a certain demographic living in Kelowna. The millionaires don't stay here, they just play here. Also, snowbirds are here only for a portion of the year, and that's why our sales were not reflecting what the head office projected they should be. The Montreal head office had little understanding of who their customers actually were.


Agree'd its its a very local market. But many people living here are retired, they also do not add significantly to the local economy.

I am not against the tax by the way, I think its a good exercise and test to see if such a tax would work to support more housing and reduce rent. Without testing it, it would only be a hypothesis.
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Re: What are the taxes on Housing In BC

Postby kgcayenne » Aug 14th, 2019, 1:27 pm

It will only work if the tax collected is used on housing programs that keep the working poor housed in the collected-from markets.
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Re: What are the taxes on Housing In BC

Postby AlienSoldier » Aug 15th, 2019, 8:32 am

kgcayenne wrote:It will only work if the tax collected is used on housing programs that keep the working poor housed in the collected-from markets.

Completely agree!

BTW: Congrats everyone! We just had an informative and polite discussion in Castanet forums regarding taxes and housing!

I think we should frame this thread.

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Re: What are the taxes on Housing In BC

Postby Catsumi » Aug 15th, 2019, 10:02 am

:hailjo:
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Re: What are the taxes on Housing In BC

Postby LTD » Aug 15th, 2019, 11:23 am

one could buy in Peachland or lake country and avoid the tax by literally being ten minutes outside of the taxable areas the whole thing makes no sense that way

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Re: What are the taxes on Housing In BC

Postby Even Steven » Aug 15th, 2019, 2:31 pm

AlienSoldier wrote:That was perfect.

Hmm, I might have to wait a while then. Do not really feel like paying the vacancy tax, and don't want to rent out a place if I can't be there to look after it.


Pfft, this is easy. Rent it out to me for $1/month, and buy me some beer. You'll avoid paying the stupid tax, I get some beer, and govt can go screw themselves.

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Re: What are the taxes on Housing In BC

Postby kgcayenne » Aug 15th, 2019, 3:40 pm

LTD wrote:one could buy in Peachland or lake country and avoid the tax by literally being ten minutes outside of the taxable areas the whole thing makes no sense that way


I am thinking it is because there are fewer services outside of the taxable areas. While yes, it's a short trip, the transit and taxi services are either inadequate, or too costly to use in order to reach services that are within the taxable areas. So, by all means, if you can afford a secondary home, then definitely buy in adjacent communities thus leaving units closer to essential services (health) for those who need easier access.
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Re: What are the taxes on Housing In BC

Postby csm » Aug 15th, 2019, 4:17 pm

Gilchy wrote:It's intended to increase available housing supply in areas that have a relatively large amount of empty or vacation properties, and to temper rampant inflation and speculation on housing prices.

Whether this is an effective way to do this, and how it can scare off people from bringing outside investment dollars and spending into the local economy, is another story.

NDP are amateurs and short sighted - a knee jerk socialist government that was "barely" brought in because the Liberals were even worse ( if you can get worse ).

If the government didn't charge so much tax on purchasing, more people would qualify to buy - but since they insist on gouging the purchaser, and you include the stress test, that reduces the number of people that qualify. Since they have to live somewhere, that means they have to rent - putting pressure on the rental market and driving rents up.

It's a catch 22 and it's solely perpetuated by a short-sighted and narrow minded money hungry ultra-socialist government bent on making sure no one gets ahead ( except for them of course ).

Renters for the most part are unaccountable for the damage they do, and you have no choice in your property - aka - you don't really own it - you just pay a hefty fee ( and continue to pay ) to borrow it.

There was a study done on new housing - $94,000 in taxes and that is BEFORE you get to the purchase price. Then they wonder why people can't afford a place.

Don't forget, you buy a place to rent out, $94,000 is an investment - you need to recoup the cost of that money in the rent, plus the interest, plus the insurance, plus the annual property taxes, plus the damage from tenants that don't give a s :cuss: t. And you wonder why rents are so high?

About renting my place out? That is MY place, my private investment. I don't share my stocks with someone because they were too stupid and lazy to buy their own. Seems the only one's allowed to steal is the Government.

Again - point to the government - they are amateurs at best, non-professionals elected to control something they know little about.

About renting my place out? That is MY place, my private investment. I don't share my stocks with someone because they were too stupid and lazy to buy their own. Seems the only one's allowed to steal is the Government.

Another reason "I'm cashing out"

NDP and Liberals are governments for the lazy and stupid - no one else.
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