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Hello everyone,
So, as the new year started, so did a new Tax for those who flipped homes in British Columbia.
The New BC Home Flipping Tax: What You Need to Know
On January 1, 2025, British Columbia introduced a new tax that targets home flippers. The BC Home Flipping Tax directly impacts anyone who earns a profit from selling properties owned for less than 730 days (two years). Whether you’re selling a traditional home or assigning a pre-sale contract, this tax could significantly affect your transaction.
Key Details About the BC Home Flipping Tax
This tax stands apart from other taxes. It does not connect to federal property flipping rules, B.C. income tax, or the property transfer tax. The government applies this tax to sellers, no matter where they live—whether in B.C., elsewhere in Canada, or internationally.
The tax covers properties with housing units, properties zoned for residential use, and rights to acquire such properties. For example, if you assign a pre-sale contract for a development unit, the tax applies. However, the government excludes certain transactions, such as sales of exempt property locations or leasehold interests.
Filing and Exemptions
If this tax applies to your sale, you must file a separate return within 90 days. Even if you claim an exemption that requires filing, the government still expects you to submit this return.
The exemptions fall into two categories:
- Exempt After Filing: You must file a return to claim the exemption.
- Exempt Without Filing: You don’t need to file any paperwork.
What This Means for You
The government created the BC Home Flipping Tax to discourage short-term property flipping and speculative buying. If you plan to sell a property in B.C. within two years of owning it, you need to understand how this tax works. Contact me today to discuss how it could impact your real estate plans and ensure you stay compliant with the new rules.
If you need more information, you can visit the governments website
