Buy A New Home During PST/HST Transitional Period?

Transitional Period is from April 1, 2012 to April 13, 2013.


If you buy a NEW house during transitional period:


1/  you will have to pay a transitional BC provincial tax of 2% on house price.


2/  you will still like before have to pay GST (5% on house price) to the federal government.

Principal Home Buyers still get federal rebate: 

**36% rebate x 5% GST x hse price $350,000 = maximum rebate $6,300

**from $350,000 to $450,000, maximum rebate $6,300 will be phased out on a straight basis; at $450,000, federal rebate=0

PST/HST Transitional Rules start Apr 1, 2012. Formula?

In BC, PST will replace HST on Apr 1, 2013.

The transitionl rules start Apr 1, 2012, one year earlier.

The Provincial Enhanced New Housing Rebate Formula will give Principal Residence Buyers more rebate back if House Price is higher than $525,000:

Old Rebate Formula   = 5% (rebate) x Hse Price (up to $525,000) =$26,250 (Max)

Transitional Rebate Formula=5% (rebate) x Hse Price (up to $850,000) =$42,500 (higher Max)

Not Living There All The Time U Owned Your Principal Residence?

Do you have to report sale of your principal residence if you don't live there the whole time you owned it?

1/  Yes, you have to report sale on your tax return.

2/  You have to calculate the PRE (Principal Residence Exemption) and taxable capital gain.

3/  PRE = (# of years used as Principal Residence + 1)   x    Total Capital Gain
              Total # of yr You Owned Your Principal Residence

The extra 1 year in the equation means the year of moving, which will be counted as principal residence.

4/  Taxable Capital Gain = Total Capital Gain  minus  PRE

Only 1.5 Acres Considered Principal Residence?

Is your Home with Lot over 1.25 Acres considered Principal Residence?

1/  Only 1.25 Acres will be considered Principal Residence.

2/  When you sell, land in excess of 1.25 Acres will be considered Capital Gain or Loss.

3/  If the property is not subdividable, the whole land may be considered Principal Residence.

You And Spouse Can Own 2 Principal Homes?

Can You And Your Spouse designate 2 Principal Residences?

After 1981: You and your spouse may only designate ONE Principal Residence both together.

Before 1982: You and your spouse can designate TWO Principal Residences, one for yourself and 1 for your spouse.

Partly Principal Home, Partly Rental, Pay Capital Gain Tax?

Do you need to pay Capital Gain Tax on sale of a Partly Principal Residence with a Rental Suite (eg, a duplex)?

1/  When you sell, you need to split the Capital Gain or Loss between Principal Residence and Rental Suite.

2/  You can do the splitting by using square feet or number of rooms.

3/  Just need to report the Rental Part.

4/  No need to report the Principal Home Part.

5/  For the Rental Part, pay Capital Gain Tax if you gain; claim loss if you lose.

Principal Home: Pay Tax On Capital Gain?

Do you need to pay tax on Sale of Principal Residence?

1/ No need to pay tax on any gain.

2/ No need to report on your income tax return.

3/ You cannot claim any loss if you lose on selling principal home because your home is considered personal-use property.