There’s some big changes coming for home investors in 2025! At Rampone-Marsh Mortgages, Kelowna mortgage brokers, we love to keep our audience up-to-date on what’s going on in the real estate world. With some big regulatory changes coming in 2025, it’s time to get familiar with the BC Home flipping tax.
The provincial government is applying a new house-flipping tax to properties sold after January 1st, 2025. Properties that are sold within two years of being bought will be subject to this tax (aside from some exemptions). The BC home flipping tax comes with many guidelines aimed at discouraging the short-term holding of property with the intent of just making profit. Starting at 20% for sales within the first year, the tax gradually reduces to zero after 730 days of ownership.
Property investors across BC will need to keep an eye out, as the profits they make off any houses bought and sold within two years will be taxed quite heavily. For those seeking loopholes, know that even residency status won’t exempt you from this tax. The legal exemptions that can be made rely on certain life circumstances that may drive the sale of a home within 2 years. These include death, disability, illness, relocation for work, divorce or separation, job loss, changes in household membership, insolvency, and personal safety. If you end up selling your home within 2 years of purchase and have an exemption, you can possibly exclude up to $20,000 from your taxable income.
As for what properties qualify: anything either zoned for living or currently holding housing units is subject to the house flipping tax. So this includes more than just homes, it covers properties that could get or already have the rights to build houses on them.
The bottom line: stay educated and updated on the coming rollout of BC’s home flipping tax. Luckily, Rampone-Marsh is by your side to help you navigate these choppy waters. Feel free to reach out to us, your trusty Kelowna mortgage mavens, for all your real estate needs.
