Happy New Year – and another tax
First off – Happy New Year. I hope you had a wonderful holiday season and 2025 is starting off great for you.
Now for some bad news – as of January 1, 2025, the BC Home Flipping Tax has taken effect. If you are selling property after this date and have owned the property for less than 730 days, the tax may apply (unless there is an exemption). This tax is separate and distinct from the Federal Property Flipping Rules. Two distinct property flipping taxes, what great news!
The BC Flipping tax applies to profit earned from a sale within the prescribed period. The tax rate is 20 percent of net taxable income earned from a property sold within 365 days, with the rate decreasing over the next 365 days such that at 730 days, the tax no longer applies.
There are a number of exemptions – including life circumstances, exemptions for builders and developers, and exemptions for property sales between related persons. There are also exemptions based on location, use of the property and ownership structure.
Rather than link a bunch of BC Government material in this email, please feel free to reach out to us at realestate@spagslaw.ca and my team will do their best to help you out. We are well equipped on the rules for both the BC Flipping Tax, together with the Federal Flipping Tax.
We will soon update the knowledge centre on our website with this information. Until next time, thank you and have a great start to the year!!