The BC Home Flipping Tax

Common questions about the flipping tax

• When did the BC Home Flipping Tax take effect?

  It took effect January 1, 2025, and applies to sales on or after that date. Importantly, it can reach a home you bought before 2025 if you sell it within 730 days of buying: the clock runs from when you bought, not from when the tax started. The filing is due within 90 days of the sale, and late filing adds penalties and interest, so the date matters even where nothing is owed.
• How is the rate worked out?

  If you sell within 365 days of buying, the tax is 20% of your profit. Between 366 and 729 days, the rate fades in a straight line toward zero. The formula is 20% × ((730 − days held) ÷ 365), so at about day 547 (roughly 18 months) it’s near 10%. At 730 days (two years) or more, there’s no flipping tax at all. The simplest way to think about it: the longer you hold past a year, the smaller the bite, and it disappears entirely at two years.

  A worked phase-out: at day 547, 20% × ((730 − 547) ÷ 365) = 20% × 0.501 ≈ 10.0%. The 730-day threshold is a hard line: a sale on day 729 is taxable, a sale on day 730 is not. The clock starts on your acquisition date (title registration, or the contract date for a presale assignment) and ends on your disposition date (the sale closing, or the assignment date). Because the line is exact, the timing of a closing can genuinely change what you owe.
• What counts as "profit"?

  Broadly, your sale price minus what you paid, minus your eligible costs: legal fees, the real estate commission, and eligible improvement costs. If the home was your principal residence for at least 365 of the days you owned it, you can also deduct up to $20,000. The exact calculation is your accountant’s domain, and it’s worth getting right, because the standard capital-gains rules and the federal anti-flipping rule can apply on top of this one.
• I have to sell early because of a life event. Am I protected?

  Very likely, yes, and this is the most important thing for anyone in a hard situation to know. The tax has a list of life-event exemptions that fully remove it: a death, a new child, a separation or divorce, a serious illness or disability, a job relocation, an involuntary job loss, insolvency, a threat to your safety, the home being destroyed or expropriated, or a family member moving in. If you’re selling because life forced your hand rather than to turn a quick profit, there’s almost certainly an exemption that fits. We’d confirm the specific one with your accountant, but you should not assume the worst.
• How does this stack with the federal anti-flipping rule?

  They’re two separate rules that can both apply to the same sale. The federal anti-flipping rule (in effect since January 1, 2023) treats a home sold within 365 days as fully taxable business income, with no Principal Residence Exemption. The BC tax is a separate 20% provincial charge on the profit, fading out over 730 days. So a home sold six months after buying can face both at once, plus the buyer’s Property Transfer Tax and (on a new build) GST. On a short hold the combined load is heavy, which is exactly why it pays to plan the timing, and to get an accountant’s read, before you sell.
• Does it matter whether I own the home personally or through a company?

  It does not change whether the tax applies. The rule reaches individuals, corporations, trusts and partnerships alike, so holding a property in a company or a family trust is not a way around it. What ownership structure does change is the arithmetic around it: how the profit is computed, and which other taxes land alongside. The $20,000 owner-occupier deduction, for instance, needs the home to have been someone's principal residence, which a corporate holding will not satisfy. If the property is held anywhere other than in your own name, get your accountant to model it specifically.
• Does it apply if I assign a presale contract?

  Yes. Assigning a presale contract for a profit is captured, and the default is taxable. Which date starts your clock depends on which side of the assignment you are on. If you bought the presale from the developer and are now assigning it, your holding period runs from your original contract date. If instead you are the one taking over someone else's contract, you are treated as having acquired the property on the assignment date, so your clock starts then, not when the original buyer signed. That catches people who take an assignment late in a project and sell soon after completion. Some assignments are exempt, particularly to a family member. If you are thinking about assigning, model the tax and the GST on the assignment fee with an accountant before you sign anything.

  One further trap on presales: they do not qualify for the builder, developer, or building-and-renovating exemptions, nor for the commercial-use exemption. The life-circumstance exemptions do still reach them. A presale you acquired before the tax started can also be caught: if you dispose of it on or after January 1, 2025 having held it under 730 days, the tax applies, because the clock is measured from your acquisition rather than from when the legislation began.
• When and how do I file?

  Within 90 days of the sale, on a dedicated BC Home Flipping Tax return. It’s separate from your regular income-tax return. Late filing brings penalties and interest. If you’re unsure whether you owe anything, the safe move is to file anyway with a zero-liability declaration: filing late when you did owe is far costlier than filing on time when you didn’t. Your accountant can handle the return; the part to remember is the 90-day clock.