Cost of Buying | Tax
Property Transfer Tax in BC
A provincial tax payable in cash at closing that cannot be added to your mortgage, which is exactly why it catches people short.
The short answer
BC charges 1% on the first $200,000, 2% on the value up to $2 million, and 3% above that, with a further 2% on residential value above $3 million. Two exemptions can remove it entirely on a new home: the newly built home exemption and the first-time buyers' exemption.
What you pay on a $1,050,000 newly built home
| List price | $1,050,000 |
|---|---|
| GST at 5% Normally added on top. A rebate may reduce it on qualifying purchases. | $52,500 |
| Property transfer tax Fully exempt: the newly built home exemption applies at or below $1,100,000. | $0 |
| Before legal fees and adjustments | $1,102,500 |
Legal fees, title insurance, and closing adjustments are extra. Rebate eligibility depends on your circumstances, so confirm it with the Canada Revenue Agency or your lawyer before relying on it.
How the rate is built
It is a stepped tax rather than a flat one, so each band applies only to the portion of the price inside it.
One percent applies to the first two hundred thousand dollars. Two percent applies from there to two million. Three percent applies above two million. On residential property a further two percent applies to the value above three million, which stacks on the three percent and makes the top portion effectively five percent.
That last stacking is the detail most calculators get wrong, and getting it wrong understates the tax on an expensive home by a meaningful amount.
It is cash at closing
This cannot be financed. It is due when the transfer registers, alongside your legal fees and adjustments, and it comes out of the same savings as your down payment.
Budget it separately from the deposit rather than assuming it is somewhere inside the mortgage.
The two exemptions worth checking
The newly built home exemption applies to a new home at or below a threshold, reducing proportionally above it and disappearing entirely a little higher. Every home in the buyer feed is newly built, so this is the one that most often applies here.
The first-time buyers' exemption is a separate route with its own, lower, thresholds. If you qualify for both you use whichever helps more. Both require you to move in within a set period and stay for the first year.
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Common questions
How much is property transfer tax in BC?
1% on the first $200,000, 2% on the portion up to $2 million, and 3% above that, plus a further 2% on residential value above $3 million. The bands are cumulative, so each rate applies only to the portion of the price inside it.
Can I add property transfer tax to my mortgage?
No. It is payable in cash when the transfer registers, alongside legal fees and adjustments, out of the same savings as your down payment. Budget it separately.
Can I avoid it on a new home?
Possibly. The newly built home exemption can remove it entirely at or below a threshold, and the first-time buyers' exemption is a separate route with lower thresholds. Both require occupancy within a set period and a year of residence. The current thresholds are on the Government of BC pages linked below.
Is the further 2% on top of the 3%?
Yes, and this is where calculators go wrong. Above $3 million the residential levy stacks on the 3% band, making the top portion effectively 5%. Treating it as a flat 2% understates the tax substantially on an expensive home.
Where these figures come from
- Government of BC, property transfer tax rates
1% to $200,000, 2% to $2M, 3% above $2M, plus a further 2% on residential value above $3M.
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- Government of BC, newly built home PTT exemption
Full exemption at $1,100,000 or less, partial to $1,150,000. Effective 1 April 2024.
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- Government of BC, first time home buyers' PTT exemption
Full exemption at $835,000 or less, partial to $860,000. Effective 1 April 2024.
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Work the numbers on a real home
Every figure here comes from government sources and from listings you can open. Search the market and check the costs against a specific price rather than a hypothetical one.