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Wednesday, July 14, 2010
Harmonized Sales Tax - HST & its Effects on BC Real Estate
Harmonized Sales Tax—HST
July 1st, 2010 The HST at 12%, composed of a federal part at 5% and a provincial part at 7%, would apply to a builder's sale of a newly constructed or substantially renovated residential complex, including a multiple unit residential complex (e.g., an apartment building). The sale of housing that has been previously occupied by an individual as a place of residence and that is exempt from GST would also be exempt for purposes of the HST. The definitions in the Excise Tax Act that relate to housing (e.g., builder, residential complex, residential unit, residential condominium unit, substantial renovation) and the CRA's current policies regarding the application of the GST to housing, would generally apply. under the HST.
Price: HST 12% Provincial HST Property 1st Time GST
Rebate (5%)Transfer Tax Buyers Exempt Rebate
$250,000 $30,000 (12,500) $3,000 ($3,000) ($4,500)
$350,000 $42,000 (17,500) $5,000 ($5,000) ($6,300)
$525,000 $63,000 (26,250) $8,500 N/A N/A
$750,000 $90,000 (26,500) $13,000 N/A N/A $1,000.000 $120,000 (26,250) $18,000 N/A N/A
Notes: 5% up to 1% on 1st exemption to 36% of the
$525,000 $200,000, $425,000 5 % of HST
than fixed at 2% on than phases up to $350,000
$26,250 after. remainder. out. declines to zero
Total Tax if Total Tax if Not
Price: 1st Time Buyer 1st Time Buyer
$250,000 $13,000 $16,000
$350,000 $18,200 $23,200
$525,000 $45,250 $45,250
$750,000 $76,750 $76,750
$1,000,000 $111,750 $111,750
Disclaimer: For more in depth analysis of the HST and applicable rebates, please speak to your Real Estate Lawyer.
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