BC home flipping tax

The proposed BC home flipping tax applies to income from the sale of a property, including presale contracts, in British Columbia if the property was owned for less than 730 days.

The tax is imposed under the Residential Property (Short-Term Holding) Profit Tax Act, which takes effect starting January 1, 2025, subject to approval by the legislature.

Property purchased before the tax’s effective date may be subject to the tax if sold on or after January 1, 2025 and owned for less than 730 days unless an exemption applies.

The BC home flipping tax is separate and distinct from the federal property flipping rules and is not harmonized or administered with the federal or B.C. income tax. It is intended to discourage short-term holding of property for profit as part of the Homes for People Plan (PDF, 5.93MB).

On this page

• Who is subject to the tax?
• Relevant properties
• Presale contracts
• How the tax is calculated
• Days of ownership
• Primary residence deduction

Who is subject to the tax?

If you sell your property on or after January 1, 2025, income earned from the sale of your property may be subject to the new tax if the property was purchased less than 730 days before the sale. 

• Example: If you purchased a property on May 1, 2023 and sold the property on January 31, 2025, income you earn from the sale of the property would be taxable. If you decide not to sell the property until June 1, 2025, then income you earn from the sale would not be subject to the tax

Note: The seller of the property may be a B.C. resident or a resident anywhere else in the world.

Exemptions

You may be exempt from paying the tax if you are eligible for an exemption.   

Relevant properties

The tax will apply to income earned from the sale of relevant properties, including:

• Properties with a housing unit
• Properties zoned for residential use
• The right to acquire the above properties, such as the assignment of a purchase contract for a pre-build condo building

The tax will not apply to exempt property locations.

Presale contracts

If you enter into a presale contract to purchase a property under development, and you buy that property (for example, you close on the property once it is complete), for the purposes of the 2-year window of the tax, you will be considered to have acquired it on the date you entered into the presale contract.

If a person is assigned a pre-sale contract and then closes on the built property, the acquisition date is the date they were assigned the contract.

When you assign a presale contract to another person within 2 years of entering into the presale contract, you will pay tax on any income received from the assignment.

• Example: You enter into a presale contract on June 1, 2025 for a condo that will complete on March 1, 2027:
  • If you buy the condo when it is completed on March 1, 2027, you will be considered to have acquired the property on June 1, 2025
• Example: A person enters into a presale contract on June 1, 2025 for a condo that will complete on March 1, 2027. On December 1, 2025, the person assigns the right to buy the property to you:
  • If you buy the condo when it is completed on March 1, 2027, you will be considered to have acquired the property on December 1, 2025

How the tax is calculated

The BC home flipping tax applies to net taxable income from the sale of taxable property that was owned for less than 730 days.

The tax is calculated by multiplying your net taxable income by your tax rate. Net taxable income is your taxable income less the primary residence deduction. Taxable income is calculated as your proceeds from the sale of the property, minus the cost to acquire the property and any eligible costs paid or payable by you to improve the property while you owned it.   

The tax rate is 20% of income earned from a property sold within 365 days. At 730 days, the tax no longer applies.

Days of ownership

To determine whether you owned a property for more than 729 days, start counting with the day you purchased the property and end with the day you sold the property.

• Example: If you purchased a property on May 1, 2023 and sold the property on January 31, 2025, you owned the property for 642 days: 
  • Since you did not own the property for more than 729 days, the BC home flipping tax applies on the sale of the property
• Example: If you purchased a property on May 1, 2023 and sold the property on May 31, 2025, you owned the property for 762 days:
  • Since you owned the property for more than 729 days, the BC home flipping tax does not apply on the sale of the property

Primary residence deduction

If you sell your primary residence and you owned the property for less than 730 days, you may be able to claim a deduction of up to $20,000 from your taxable income if you meet the following conditions:

• You owned the property for at least 365 consecutive days before you sold it
• The property includes a housing unit that you lived in as your primary residence while you owned it

A primary residence is defined as the place you lived in longer than any other place during the time you owned the residence. The primary residence deduction isn’t available when you assign a presale contract.

• Example: Sam bought a house and lived in it for 20 consecutive months as his primary residence before selling the property.
  • Sam owned the property for more than 365 consecutive days and the property was his primary residence during the time he owned the property, therefore, Sam is eligible for the primary residence deduction

• Example: Amrita bought a condo and lived in it for 6 consecutive months as her primary residence before selling the property.
  • Because Amrita did not own the property for at least 365 consecutive days, Amrita does not qualify for the primary residence exemption

If you sell a portion of your interest in the property, your primary residence deduction amount will be proportionate to that interest.