The BC government introduced new legislation yesterday that will impose a 15% tax on all foreign buyers of residential property in the Metro Vancouver area. This tax will apply in addition to the general property transfer tax to all transactions that complete on August 2nd, 2016 or later.
Who is a Foreign National?
- Any person who is not a Canadian citizen or permanent resident;
- Corporations that are either controlled by foreign nationals or not registered in Canada; and
- Trustees or beneficiaries of a trust that are a foreign national or foreign corporation.
Which Properties Will the Tax Apply To?
The tax will apply to any residential property bought by a foreign national in the following areas:
Anmore, Belcarra, Bowen Island, Burnaby, Coquitlam, Delta, Langley City and Township, Lion’s Bay, Maple Ridge, New Westminster, North Vancouver City and District, Pitt Meadows, Port Coquitlam, Port Moody, Richmond, Surrey, Vancouver, West Vancouver, White Rock and Electoral Area A. Properties located on Tsawwassen First Nation lands are excluded.
If the property is not solely a residential-use property, the additional tax will only apply to the residential component of the property.
How Will the Tax Apply?
The additional tax of 15% will apply to any property transfer on or after August 2nd, 2016 by a foreign national and will be calculated as 15% of the fair market value of the foreign national’s share of the residential property. This tax will apply in addition to the general property transfer tax on the transaction.
The new tax will apply to foreign buyers as of August 2nd, 2016 regardless of when a purchase contract was entered into. For more information about the new tax, please see this BC government information sheet.