Property Transfer Tax - What is it?

Property Transfer Tax (PTT) is one of the biggest closing costs when you are buying a property. It is basically a land registration tax paid by the buyer(s) to the Province of British Columbia. Other transactions that will also trigger PTT include transfer of title, foreclosure, or transfer of title from individual(s) to a corporation.

The amount of PTT is based on the fair market value of the land and improvement.  The fair market value is determined either by the purchase price on the contract, a recent appraisal by an independent appraiser, or BC Assessment. The tax structure is as follows:

• 1% on the first $200,000
• 2% on the balance up to and including $2,000,000
• 3% on the balance greater than $2,000,000

There are a few exemptions in which PTT is exempted.  The most commonly seen are:

• First Time Home Buyer's Program
• Newly Built Homes
• Transfer of a Principal Residence between Related Individuals.
• Transfer resulting from a Marriage Breakdown