About Property Transfer Tax

Property Transfer Tax is a land registration tax. It must be paid when an application for a taxable transaction is made at any Land Title Office in British Columbia to register changes to a certificate of title. Property Transfer Tax
is payable on the fair market value of the property being transferred. More information on taxable interests is available here.

Fair market value is the price that would be paid by a willing purchaser to a willing seller in the open market on the date of registration. An open market is where the property is offered for sale so that anyone likely to be interested in purchasing it may make an offer. Often for a residential property, this is done by listing with a realtor or by advertising in the press and putting out a "For Sale" sign. If your tax return is reviewed by this office, you may be asked to provide evidence of how you knew the property was for sale.

Usually, fair market value is the purchase price. In other instances, such as where no money changes hands or the transfer did not take place in the open market, the fair market value must be determined by other means, such as an independent appraisal or by reference to the most relevant BC Assessment value.

BC Assessment property assessments reflect fair market value as at July 1 of the previous year. For example, assessed values for the 2007 tax year are based on what the property would have sold for in the open market as at July 1, 2006. Because property markets can change rapidly, you may need a more recent valuation, such as an independent appraisal, of what the property is worth at the time of registration.

Under the Interpretation Act, land means any interest in land, including any right, title or estate in it of any tenure, with buildings and houses, unless there are words to exclude buildings and houses or to restrict the meaning. Because there is no limiting definition in the Property Transfer Tax Act, tax is payable on the fair market value of the land, plus all improvements on that land at the time of registration.

Accordingly, houses and other structures attached to the land are included in the fair market value. Improvements may include timber, paving and anything that add value to the land. Manufactured homes registered in, and not excluded from, the Manufactured Homes Registry are not included.

You are required to pay Property Transfer Tax unless you qualify for an exemption.