When purchasing Real Estate in Victoria there are extra costs that apply. If you purchase a new home or substantially renovated home, GST (HST in some provinces) is applicable. As of January the 1st, 2008 GST was reduced from 6% to 5%. There is also a provincial Property Transfer Tax which is calculated at 1% on the first $200,000 and 2% on the balance of the sale price.
A recent Canada Revenue Agency Memorandum explains how to calculate the net price of real property (stated price minus the GST rebate) at the new GST tax rate of 5% in situations where a builder and purchaser agree that the stated price for the unit includes the tax payable but is net of the new housing rebate (where eligibility requirements are met) credited by the builder to the purchaser. This could be helpful to determine the net price of property. As you may or may not know, it is the net price which is used to calculate the amount of provincial Property Transfer Tax payable on a purchase.
Our beloved federal Government has posted some article on their website that will help to explain some of this. If you have any comments or thoughts on the above, just drop us a note below. If you have questions about Victoria Real Estate in general, you can contact us anytime.
In Closing, have a great day and talk to you soon.
Anders Treiberg, Associate Broker, REALTOR®
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