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Misconceptions and the Need for an HST Calculator for New Homes and Presales in Vancouver!

When the Harmonized Sales Tax (HST) replaced British Columbia’s Provincial Sales Tax (PST) and the Federal Goods and Services Tax (GST) July 1st, 2010 there was a LOT of confusion among those interested in Vancouver Real Estate to say the least!

One of the greatest misconceptions about the HST was that the Harmonized Sales Tax was payable on all real estate transactions in BC.

Fortunately, HST is only payable on new properties in British Columbia.

I speak to a lot of people about Presales in Vancouver and a constant question I hear is “Do I have to pay the full 12% on any new property or presale in Vancouver?” to which I answer “No, there is an HST Rebate in BC.” The next question is a toughie and is always “How much is the HST Rebate on new property in BC?” which until recently I would answer with “I don’t know exactly, best to ask your accountant…” Not anymore!

I found this great Net Harmonized Sales Tax (HST) and Net Property Transfer Tax Calculator that actually calculates the NET taxes payable on a new home purchase here in BC.

This tool calculates the HST rebate as well as the First Time Home Buyers Exemption for BC Property Transfer Tax. Remember, I am not an accountant and I am NOT giving tax advice. Confirm all tax details and calculations with your accountant.

How Much HST will be payable on New Properties in Vancouver?

The REBGV recently sent out a publication on the Top 25 Grants for Property Buyers and Owners which had the following synopsis of the HST rebate on new Owner Occupied Primary Residences:

“Buyers of new or substantially renovated homes priced up to $525,000 are eligible for a rebate of 71.43% of the provincial portion (7%) of the 12% HST paid to a maximum rebate of $26,250. Homes priced at $525,000+ are eligible for a flat rebate of $26,250″

and new Revenue Properties:

“Landlords buying new or substantially renovated homes are eligible for a rebate of 71.43% of the provincial portion of the HST, up to $26,250 per unit”

So if you’re buying a pre sale condo in Vancouver for investment or to live in or you are purchasing a new property or having a house built for you, the above rules apply.

*** PLEASE NOTE *** This calculator is for entertainment purposes only! Please consult an accountant with any and all HST rebate, PTT, or HST Calculations!

Looking for information on British Columbia’s PTT? Check out my video on Property Transfer Tax!

First Time Home Buyer in Vancouver? Check out these Videos for First Time Buyers!

Looking for advice on how to sell a Condo in Vancouver? Check out these Videos on How to Sell a Vancouver Condo!

I ENCOURAGE COMMENTS & WOULD LOVE TO HEAR YOUR THOUGHTS & QUESTIONS BELOW!

BC HST and Vancouver Real Estate

Hi All,

There are A LOT of misconceptions about British Columbia’s Harmonized Goods and Services Tax and Vancouver Real Estate. The one I hear most is that HST will payable on all real estate transactions in BC. This is not true!

HST in BC will ONLY BE PAYABLE ON BRAND NEW PROPERTIES! These are properties that have never been registered at the Land Titles Office or have never been transferred out of the ownership of the developer/builder.

Quick Facts on BC’s HST

1. BC’s HST comes into effect on July 1, 2010 and is 12%.
2. Only payable on BRAND NEW PROPERTIES!
3. Will be payable on Pre-sales and Assignments that Complete after July 1, 2010.
4. HST is not payable on Re-Sale Properties!
5. There are HST Rebates for properties under $525K

What does this mean for the Vancouver Real Estate Market?

Brand new properties will get a lot more expensive and may be less attractive compared to re-sale properties. Will it be the end of the world? No. Will it be good for the sellers of re-sale Vancouver real estate? Most likely.

Looking for a great HST Calculator? Check out my video blog post on this great PTT/HST Calculator!

I’d love to hear your thoughts and questions in the form of a comment down below!