Some pre-sale home buyers in BC have been flipping or assigning their contract to a new buyer for profit. A policy loophole has allowed some to do so without paying any capital gains tax.
This has practice has also raised concerns of tax evasion and money laundering, and some suspect that the activity has heavily contributed to the quick rise in real estate prices.
In an effort to make BC’s real estate market more transparent and to crack down on tax evasion, the British Columbia government has released the Condo and Strata Assignment Integrity Register (CSAIR).
As of January 1 2019, developers selling strata units must:
- include terms and a notice in their contracts to inform buyers of the new collection and reporting requirements;
- collect information, including the terms of the assignment and the name and social insurance number or business information of the parties to the assignment; and
- report this information in the online register.
Information from CSAIR will then be provided to the federal government’s Canada Revenue Agency. The government will use this information to ensure that the appropriate property transfer tax is paid and to inform future housing and tax policy.
You can read more about CSAIR here