Property taxes for Vancouver are due July 3 and the surrounding areas are due by July 2, and if your payment is not postmarked by that date or if you pay less than the full balance owed, you’ll typically owe a late fee on top of the balance owed. While property transfer tax is a one-time tax when you buy a property in BC, property taxes are an annual, ongoing tax liability for as long as you’re a homeowner. The revenue from property taxes goes to fund schools, roads, police and fire protection, parks and more.
If you’re new to homeownership (or simply need a reminder of how property taxes work), here’s a quick primer.
- Timeline of property taxes: Property taxes are based on the calendar year, so the previous owner may owe a portion of that years’ taxes depending on the date of sale. If, for example, you closed on May 1, then the previous owner would owe property taxes covering the period between January 1 and April 30. Your real estate attorney should determine at closing how much the previous owner owes and credit you that amount to cover the previous owner’s property tax liability.
- Homeowner grants: British Columbia and other provinces offer grants to qualified homeowners that will lower the cost of property taxes on a primary residence. You must be a Canadian citizen or permanent resident to qualify for the Home Owner Grant, and larger grants are available to seniors, veterans or those with disabilities. It’s too late to apply for the grant this year, but you could apply in the future to lower your tax liability.
- High-ratio mortgages: If you’re borrowing more than 80 per cent of the property’s value (meaning it’s an insured mortgage, also called a high-ratio mortgage) then your lender will typically pay the property taxes on your behalf and include that amount in your mortgage instead of relying on you to pay property taxes directly. Any time your status changes – say, you assumed you’d qualify for the Home Owner Grant but are not eligible, or you were not eligible in the past and now you are – be sure to notify your lender so that it will pay the appropriate amount in taxes.
- Defer property taxes: If you’re over age 55, a surviving spouse or a parent supporting a child, you may qualify to defer your property taxes. Deferment applications must be postmarked by July 2. As long as you’re approved for deferment, you won’t be charged a late penalty even if your approval comes after the tax deadline.
- Appeal property assessments: Vancouver’s residential property taxes are among the lowest in Canada, reports the Globe and Mail. However, if you believe your property tax assessment is inaccurate, you can appeal your property assessment. The deadline for filing appeals for this year’s assessments was February 2.