I. Property transfer tax
In British Columbia, you have to pay property transfer tax when you buy a house. The calculation method of real estate transfer tax is: for the first $200,000 of the purchase amount, the provincial government will levy a tax of 1%; There is a 2% tax on the part above $200,000. Considering that the average house price in large temperature areas exceeds 200,000, the simple calculation method usually used is to multiply the purchase amount by 2% and subtract 2,000. For example, if you buy a 400,000 house, the property transfer tax is 8,000-2,000 = 6,000; Buy a house of 1 10,000, 20,000-2,000 USD = property transfer tax10.8 million.
The provincial government makes an exception for qualified buyers. If you are a Canadian citizen or resident, you have never owned a property in the world before, and the house price is below $475,000. Those who meet these main conditions and other conditions can reduce this tax. But for "non-residents", this kind of preferential treatment does not exist, and property transfer tax must be paid.
Goods and services tax
If you buy a new house, you need to pay GST, because British Columbia implemented HST in July 20 10, and then abolished it in April 20 13, and the relevant regulations are quite complicated. Simply put, if the new house transaction date is on or before March 20 15, the tax to be paid is 5% GST+. If the transaction is completed after April 20 15 1 day, there is no need to pay the transition tax, and the GST to be paid is 5% of the house price.
Non-residents can apply for GST tax refund if they meet the relevant conditions when purchasing a new house.
3. Taxes to be paid when holding real estate.
Property tax is a tax that owners who own real estate in Canada have to pay to the municipal government every year. Non-resident owners can also apply for self-occupation subsidies if they meet the relevant conditions.
4. Taxes to be paid when renting real estate in Canada.
Income and expenditure, if non-local property buyers buy a house for their own use, whether for family living or as a holiday house, there is no income and no tax. However, if a non-resident buyer buys a rented house and the buyer is also a non-tax resident in the tax law, the income from renting a house is taxable.
The management company will submit 25% of the total income to the tax authorities every month as a retention deposit. Of course, there are many items that can be deducted, such as loan interest, local tax, management fees, minor repairs and other expenses.
5. Selling real estate in Canada is taxable.
(a) the sale of housing assets value-added tax
Value-added tax on assets = (selling house price-expenses related to purchasing house price) * 25%, which is collected by the IRS of Canada. When a non-tax resident sells a property, the seller's lawyer or notary will notify the IRS of Canada and apply for a liquidation certificate to confirm that the tax that must be paid due to the appreciation of the property has been paid. The certificate will be sent to the seller and the buyer to protect the interests of both parties.
Before obtaining the tax payment certificate, the buyer's lawyer or notary will detain 25% or more of the selling price as a deposit in his trust account. If the seller fails to get the tax payment certificate or settle the payable value-added tax with the IRS within 30 days after the delivery of the house, the buyer's lawyer will contact the IRS with this deposit, and the seller will settle it with the IRS when filing the tax return.
(2) Asset value-added tax on the sale of uncompleted flats
When purchasing uncompleted flats, developers may require non-resident buyers to pay 25-35% advance payment in installments. If the house is sold before the transaction, the lawyer will also detain the above deposit to ensure that the IRS receives the relevant VAT.
That's what I brought to you today about the inevitable tax on non-residents buying houses in Canada. I hope I can help you.