B.C. is aiming to crack down on home flipping in the province with a new measure that will tax home owners who resell their property within two years of purchasing it.
The home flipping tax was announced in Thursday’s 2024 budget and is set to come into play on Jan. 1, 2025.
If the legislation passes, it will tax home owners 20 per cent on properties sold within 365 days of purchase. The tax rate will then gradually decrease for home owners who sell within the first and second year of purchase.
It will not apply to land or portions of land used for non-residential purposes, and the province says certain exemptions will be allowed for life events such as “divorce, death, disability or illness, relocation for work, involuntary job loss, change in household membership, personal safety or insolvency.”
People selling their primary home within two years of purchase will also be allowed to exclude up to $20,000 when calculating their taxable income.
The tax is expected to bring in about $11 million in revenue in the first half of 2025, and then $43 for the next two full years of its implementation. The province says that money will go directly into building more affordable homes.
The province says the aim of the measure is to increase housing supply and, if a home owner can show that their sale is in fact adding homes, they will be exempt from it.
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