Property Transfer Tax (PTT) is a one time tax paid to Province of BC by the purchaser whenever there is a change of ownership or change in shared % interest in a property. PTT is calculated based on the fair market value of the property at the time of transfer. The percentage of the tax that you owe is based on the % shared ownership or shared interest you have. For example, if a husband and wife are both registered on title with 50% ownership each, then each owes 50% of the tax.

Another important point to keep in mind is that Property Transfer Tax (PTT) is provincial and is NOT the same as the annual Property Tax which is paid to the local municipality every year. Often confused with PTT, annual property tax is paid to the local municipality by the registered owner(s) for ongoing use and maintenance of municipality services such as water supply, garbage collection, sewer services, road maintenance, park maintenance and more.

Property transfer tax is calculated using a formula based on the fair market value (or agreed purchase price) of the property as follows:

1% on the first $200,000 of the fair market value,
2% on the portion of the fair market value greater than $200,000 and up to and including $2,000,000,

3% on the portion of the fair market value greater than $2,000,000, and

If the property is residential, a further 2% on the portion of the fair market value greater than $3,000,000.
If the property is classified as residential and farm, or is residential mixed class (such as residential and commercial), you pay the further 2% tax on only the residential portion of the property.

Property Transfer Tax is paid through the purchaser`s lawyer or notary office upon completion of purchase. This amount is can be found on your Purchaser Statement of Adjustments.

Sellers do not pay PTT because they have already paid at the time they purchased the property from the previous owner. The rule is that the new registered owner is responsible for paying the transfer tax.

The short answer is yes! There are many PTT exemptions available to purchasers; however, for our first-time buyers and presale buyers, we will focus on the two common exemptions that purchasers may qualify for. There are full and partial exemptions available.

This property transfer tax exemption is available for purchasers who are buying their first home located in the province of British Columbia.

FULL EXEMPTION REQUIREMENTS
To qualify for a full exemption, the following requirements must be met:
1.     You must not own a principal residence anywhere in the world;
2.     You must not have previously received a BC FTHB exemption or refund;
3.     You are a Canadian citizen or a permanent resident;
4.     You have continuously resided in BC for at least one year immediately prior to the registration date; or have filed income tax returns as a BC resident during the six years before the completion date; and
5.     The property is located in B.C, is primarily used as principal residence, has a fair market value of $500,000 or less and be 0.5 hectares (1.24acres) or smaller.

PARTIAL EXEMPTION REQUIREMENTS
To qualify for partial exemption, you must meet all the following requirements:
1.         You must not own a principal residence anywhere in the world
2.         You must not have previously received a BC FTHB exemption or refund
3.         You are a Canadian citizen or a permanent resident
4.         You have continuously resided in BC for at least one year immediately prior to the registration date; or have filed income tax returns as a BC resident during the six years before the completion date; and
5.         the subject property is: located in B.C, primarily used as a principal residence, more than $500,000 or less than or equal to $525,000 in fair market value, is larger than 0.5 hectares and has another building on the same property other than the principal residence.