A property in Vancouver sells for $1,200,000 to a Canadian citizen who is not a first-time buyer. What is the Property Transfer Tax owing?

Q: What is the correct answer to: A property in Vancouver sells for $1,200,000 to a Canadian citizen who is not a first-time buyer. What is the Property Transfer Tax owing?

The correct answer is $22,000. Option B ($22,000) is correct. PTT calculation: 1% x $200,000 = $2,000 + 2% x $1,000,000 ($1,200,000 - $200,000) = $20,000. Total PTT = $2,000 + $20,000 = $22,000.

Q: What background knowledge is needed for this Real Estate Taxation question?

For properties between $200,000 and $2,000,000, the PTT calculation involves two brackets. The first $200,000 is always taxed at 1% ($2,000), and the balance up to $2,000,000 is taxed at 2%. At $1,200,000, the second bracket portion is $1,000,000, taxed at 2% = $20,000. The total of $22,000 represents about 1.83% of the purchase price — higher than the 1% entry rate but lower than the 2% rate alone.

Q: What is a good way to remember the answer to this Real Estate Taxation question?

Every PTT calculation starts with the same base: 1% x $200,000 = $2,000. This is constant for any property over $200K. Then add 2% of the remaining amount above $200K. For $1.2M: $2,000 + 2% x $1M = $22,000. On the exam, always begin with $2,000 (the first bracket). Then calculate 2% of the amount above $200K. If the property is under $2M, these two amounts give you the total.

Q: What exam tip applies to this Real Estate Taxation question?

A common trap is calculating 2% of the full price instead of using brackets. Always remember to apply 1% to the first $200K separately. The $2,000 base amount is your anchor for every calculation.

Q: How does this Real Estate Taxation concept apply in real world practice?

A non-first-time Canadian buyer purchases a townhouse in Burnaby for $1,200,000. Their notary provides the PTT calculation: $2,000 (1% on first $200K) + $20,000 (2% on remaining $1,000,000) = $22,000 total. The buyer must have these funds available at closing in addition to their down payment and closing costs.

Question

Real Estate TaxationBCMEDIUM

A property in Vancouver sells for $1,200,000 to a Canadian citizen who is not a first-time buyer. What is the Property Transfer Tax owing?

Answer Options

A

$18,000

B

$22,000

C

$24,000

D

$20,000