British Columbia - Tax changes affecting real estate matters

Changes to the speculation and vacancy tax and a new BC flipping tax are effective from 1 January 2025.

Speculation and vacancy tax

After January 1, 2024, the definition of owner for the purposes of the speculation and vacancy tax has expanded to include registered leaseholders. If a lease is registered on title, the leaseholder is responsible for the tax and must complete the annual declaration. Registered leaseholders will start to declare in 2025 based on how they used the property in 2024.

BC home flipping tax.

Under the Residential Property (Short-Term Holding) Profit Tax Act, effective from January 1, 2025, taxable property sold that was owned for less than 730 days is subject to a flipping tax. Taxable property is a beneficial interest in residential property, or the right to acquire a beneficial interest in it.

The tax applies to individuals, corporations, partnerships, and trusts. There is no residency requirement.

Property purchased before the effective date is subject to the tax if it is sold on or after the effective date and was owned for less than 730 days unless one of the available exemptions applies to the transaction.

The tax rate is 20% of the net taxable income when the property is sold within 365 days of acquiring it. The tax rate decreases after 365 days of ownership until it is 0% at 730 days of ownership.

The By Lawyers Sale and Purchase of Real Estate publications have been updated to reflect these legislative changes.