Canada: New Vancouver-Area Real Estate Taxes

Two taxes have been recently introduced in the Vancouver area, designed to cool the local estate market.

The BC "Foreign Buyer Tax"

Effective August 2, 2016, a transfer tax of 15% of fair market value is payable by "foreign nationals" or "foreign corporations" who acquire "residential property" in the Greater Vancouver Regional District (the "GVRD") (other than the treaty lands of the Tsawwassen First Nation). This additional property transfer tax ("Additional PTT"), frequently referred to by the media as the "Foreign Buyer Tax", is in addition to the pre-existing British Columbia property transfer tax of between 1 and 3%, with the result that a foreign purchaser must pay between a 16% and 18% transfer tax on residential property in the GVRD. The government has the ability to extend the tax to other parts of the Province or increase the rate, up to 20%.

Key takeways:

  • "Residential property" is any property classified by the BC Assessment Authority as "residential", and includes a range of properties with commercial elements, including rental apartment buildings, nursing homes and rest homes. In many instances, property acquired for development will be classified as residential.
  • A "foreign national" is currently any individual who is not a Canadian citizen or permanent resident.
  • As of March 17, 2017, the Province has introduced a limited, one time exemption for foreign nationals who are confirmed under the BC Provincial Nominee Program and purchasing a principal residence. Individual purchasers who have paid the Additional PTT but would have qualified for this exemption at time of purchase may apply for a refund. Individuals who become Canadian citizens within one year of their date of purchase of a principal residence may also apply for a refund, provided they meet certain property use requirements. There are time limits for applying for such refunds.
  • The definition of "foreign corporation" is complex, but essentially is (i) any corporation not incorporated in Canada OR (ii) a Canadian corporation, where shares are not listed on a Canadian exchange, that is "controlled" (defined with reference to the Income Tax Act (Canada)) by any of (A) a foreign national , (B) a corporation not incorporated in Canada or (C) a corporation whose controlling shareholders are foreign nationals or foreign corporations.
  • For trusts, if ANY trustee, or current beneficiary of the trust is a foreign national or foreign corporation at the time property is acquired, the purchase will attract the Additional PTT.
  • A limited partnership purchaser with foreign limited partners may also be required to pay the Additional PTT.
  • Some widely used exemptions from the basic property transfer tax will not apply to exempt the Additional PTT namely:
    • Registration of an amalgamation of corporate entities
    • Replacement/substitution of a registered trustee even if the beneficial ownership of the trust is not changing
    • Transmissions to surviving joint tenants

These key exemptions will still apply with respect to the basic property transfer tax but will not apply with respect to the Additional PTT.

The legislation also introduces an anti-avoidance rule, steep offence penalties and a lengthy time period for reassessment (6 years instead of the 1 year period, for the basic property transfer tax), specific to the Additional PTT.

The legislation did not provide for a transition period or grandfathering, and the tax applies to any transaction registered on or after August 2, 2016. Thus, foreign entities who are currently holding property in the GVRD may face unexpected consequences in land title transactions.

City of Vancouver Vacancy Tax

The City of Vancouver's Vacancy Tax By-Law, enacted on November 16, 2016, imposes a vacancy tax of 1% of assessed value ("Vacancy Tax") on "vacant" residential properties located in Vancouver, unless the property comes within one of the limited exemptions. As with the Additional PTT, "residential property" is any property classified as residential by the BC Assessment Authority. Property is deemed "vacant" if it is not either:

  1. the principal residence of an individual, or
  2. "occupied" by a tenant or subtenant for terms of at least 30 days at time,

for a sufficient portion of a calendar year, as described in the next sentence. If the property is "vacant" for more than 180 days in a calendar year, the tax is triggered. In other words, a residential property must be a principal residence or tenanted for just over half the year, or it will be deemed "vacant". Vancouver has not published guidance on what it will consider "occupied" by a tenant.

The tax will be payable annually in early April commencing in 2018, based on the use of the property in the preceding calendar year. Accordingly, it is critical for owners of property in Vancouver that may currently be considered vacant to be aware of this new By-Law: it is the use of the property in 2017 that will determine whether one must pay the 1% tax in 2018.

Each owner of residential property within Vancouver will be required to complete a "property status declaration form" in the first part of each year, as to the use of the property in the prior calendar year.

Key exemptions under the By-Law are as follows:

  • Renovations/development: all permits have been issued, property needs to be empty for safety, and the owner is carrying out renovations without unnecessary delay.
  • Strata rental restrictions: Where there is a rental restriction, passed prior to November 16, 2016, rentals in the strata corporation are at maximum and the owner is on the wait list to rent out his or her unit.
  • Homes used by owner(s) who only work part of the year in Vancouver, where the home is used by the owner for at least 180 days of the year
  • Property sold in the prior year – i.e., a purchaser who buys in 2017 will be exempt from payment based on the 2017 use.
  • The owner has passed away, and there is not yet a grant of probate.

The exemptions are deliberately limited. The City's stated purpose is to encourage property owners to either live in, rent, develop or sell their properties, rather than hold them for investment, use for nightly or short term AirBnB-type rentals, or in anticipation of some future event. Properties that are not exempt include: bare land that is assessed as residential, vacation homes, property used for nightly rentals, properties that are up for sale or rent without success, and properties in need of renovations.

While there is a two-level appeal process, there is no opportunity for an owner to make a hardship or exception application. The appeal process is strictly limited to whether or not the City has correctly applied the By-Law. The limitation periods for making appeals are very short – less than a month, in most cases.

Owners of "vacant" residential properties in the City may wish to seek advice as to what steps can be taken so that the 2017 use will not trigger the tax in 2018.

It is anticipated that the City of Vancouver will issue further clarification this year regarding the application of the By-Law and/or additional exemptions. As of March 2017, such amendments have not been tabled.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.