Under BC's Property Transfer Tax Act, which of the following transfers would be exempt from property transfer tax? Assume every individual is a Canadian citizen.
Correct Answer
C) Parent's gift to a child of the parent's long-time principal residence
Property Transfer Tax Act s. 14(3)(b) exempts a transfer to a related individual (which includes a child) if the land has been the transferor's principal residence for a continuous period of at least 6 months immediately before the transfer, or the transferee's for that period. The exemption is specific: a family gift of other land, such as a rental property, is taxed on fair market value.
Why This Is the Correct Answer
This answer is correct. A parent's gift of their long-time principal residence to a child fits s. 14(3)(b), provided the land meets the Act's principal residence definition.
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