BC home flipping tax

The BC home flipping tax applies to the profit you earn from selling a property in British Columbia (including presale contracts) if you owned the property for less than 730 days.

The tax is imposed under the Residential Property (Short-Term Holding) Profit Tax Act, which takes effect starting January 1, 2025.

Property purchased before the tax’s effective date may be subject to the tax if sold on or after January 1, 2025 and owned for less than 730 days, unless an exemption applies.

The BC home flipping tax is separate and distinct from the federal property flipping rules and is not harmonized or administered with the federal or B.C. income tax. It is intended to discourage short-term holding of property for profit as part of the Homes for People Plan (PDF, 5.93MB).

On this page

• Who is subject to the tax?
• Exemptions from the tax
• How the tax is calculated
• Days of ownership
• Primary residence deduction
• Do I need to file a return

Who is subject to the tax?

If a person (which can include an individual, corporation, partnership or trust) sells or disposes of a taxable property on or after January 1, 2025, the profit earned from the sale would be subject to the new tax if the property was purchased less than 730 days before the sale. The seller of the property may be a B.C. resident or a resident anywhere else in the world.

A disposition of a taxable property (sale of a taxable property) refers to the execution of a contract by which a beneficial interest in residential property is transferred from the seller to the purchaser in exchange for consideration in money or in kind. Therefore, for the purposes of the BC home flipping tax, a disposition of a taxable property would not generally be considered to include a:

• Deemed disposition under the Income Tax Act (Canada) or other legislation
• Mortgage, charge, or lien on a taxable property
• Lease
• Gift
• Any other transaction or event resulting in a change in legal title but not a change in beneficial ownership

Taxable properties

Taxable property refers to a beneficial interest in residential property, or a right to acquire a beneficial interest in residential property.

Generally, this means the tax will apply to the profit you earn from the sale of:

• Properties with a housing unit
• Properties zoned for residential use
• The right to acquire the above properties, such as the assignment of a purchase contract for a pre-build condo building

The tax will not apply to exempt property locations or the leasing or sale of a leasehold interest in a property.

Exemptions from the tax

You may not need to pay the tax if you are eligible for an exemption. Depending on your exemption, you are either exempt only after filing a return, or can be exempt without filing a return.

How the tax is calculated

The BC home flipping tax applies to net taxable income from the sale of taxable property that was owned for less than 730 days.

The tax rate is 20 percent of net taxable income earned from a property sold within 365 days, and the rate decreases over the next 365 days. At 730 days, the tax no longer applies.

Check how much tax you need to pay with a step-by-step calculation.

Days of ownership

To determine whether you owned a property for more than 729 days, start counting with the day you purchased the property and end with the day you sold the property.

The day you purchase a property is generally the date you pay for the property. For most people, this will be the closing date, which is the date that the seller transfers ownership to you and is the time the seller is entitled to receive your money for the sale.

The day you sell a property is generally the date you receive money for the property. For most people, this will be the closing date, which is the date you transfer ownership to the purchaser and is the time you are entitled to receive the purchaser’s money for the sale.

Days of ownership are determined differently if you purchased a presale contract or if you purchased from a related person.

Days of ownership for presale contracts

The day you purchase a presale contract is generally the date you pay for the contract, which is also the date you enter into the presale contract.

If you purchase the presale contract directly from a developer, this is generally the date you pay the contract deposit to the developer.

If you purchased or were assigned a presale contract and then purchase the completed property, the date you purchased or were assigned the presale contract is also considered to be the date you purchased the completed property.

The day you sell or assign a right to acquire a property, for example a presale contract, is generally the date you receive money from the purchaser or assignee for the right.

Days of ownership if you purchased from a related person

If a person purchases a property from a related person, the purchase date is deemed to be when the related person first purchased that property.

The purchase date is only relevant if you purchase from a related person and sell to an unrelated person. If you both purchase from and sell to a related person, you qualify for the exemption for property sales between related persons. 

If there is a series of purchases of a property between related persons, and each purchase in the series involves related parties, the last person to purchase the property is deemed to have purchased the property on the date it was purchased by the first person in the series. For this rule to apply, each person must purchase the property from a related person, but each person does not need to be related to every person involved in the series of purchases.

Primary residence deduction

If you sell your primary residence and you owned the property for less than 730 days, you may be able to claim a deduction of up to $20,000 from your taxable income if you meet all of the following conditions:

• You owned the property for at least 365 consecutive days before you sold it
• The property includes a housing unit that you lived in as your primary residence while you owned it

A primary residence is defined as the place you lived in longer than any other place during the time you owned the residence. The primary residence deduction isn’t available when you assign a presale contract.

If you sell a portion of your interest in the property, your primary residence deduction amount will be proportionate to that interest.

Do I need to file a BC home flipping tax return

You must file a BC home flipping tax return within 90 days of the sale, if either of the following applies:

• You qualify for the tax, as you sold your property within 729 days of purchasing it and are not eligible for any exemptions
• Your exemption applies only after you file a return

You do not have to file a return if one of the following applies:

• You do not qualify for the tax as you sold your property after owning it for more than 729 days
• Your exemption applies without needing to file a return
• You are a developer and you are initially entering into an agreement which establishes a right to acquire a property (for example, when a developer enters into a presale agreement with an initial purchaser)

The BC home flipping tax return is separate and distinct from the annual income tax filings.