Property Transfer Tax on Pre-Sold Strata Units
When you purchase a condo unit on the open market well in advance of the completion of the building, you will generally pay property transfer tax on the total amount you paid to acquire the property. The total amount includes any money paid for:
- upgrades or additions, or
- any other premium for assignment of a written agreement
You may transfer the right to purchase the property to a related individual (doesn't include brothers and sisters) before the property is registered at the Land Title Office without affecting the taxable amount.
If you transfer the right to purchase the property to someone who isn’t a related individual, property transfer tax is paid on the final purchase price of the unit, which includes all assignment amounts. Any profits made from an assignment of a pre-sale condo or strata unit must be reported on your income tax or capital gains.
Effective January 2019, developers are required to collect information about each assignment, including certain personal information, and input it into the Condo and Strata Assignment Integrity Register (CSAIR).
This doesn't include bare land stratas.
If you’re a foreign national, foreign corporation or taxable trustee, you pay the additional property transfer tax in addition to the property transfer tax if your property is located in specified areas of B.C.
The additional tax is payable when you register the property. If a foreign entity or a taxable trustee signs the original contract, but then assigns the contract to a Canadian citizen or permanent resident before the property is registered, the additional tax won’t apply. However, penalties may be applied if there is proof the assignment was done for tax avoidance purposes.