Property Taxes, Assessments, and Grants - December 2019 Update

Dated: 12/12/2019

Views: 70

*This article was originally posted on January 11, 2017. It has been updated to reflect current dates and new policies.

It's that time of year again! BC Assessment will be sending out their updated property assessment values in early January 2020, and the first installment of your 2020 property taxes is due in early February. 

In Vancouver, we pay our property taxes in two installments – once in February, and again in July. In 2020, your first installment of City of Vancouver property taxes are due to be paid by FEBRUARY 04, 2020, and the balance is due on JULY 03, 2020. For simplicity, this blog focuses on the policies of the City of Vancouver. Be sure to confirm this information with your local municipality, as their policies may differ from the City of Vancouver.

I’m going to focus on a few topics to provide some clarity to you on how property taxes are calculated, property assessments, payment options, and the grant that may or may not be available to you.

How are my property taxes calculated?

In Vancouver property taxes are calculated using the mill rate – follow this link for a detailed breakdown of the rates in Vancouver. Basically, the amount you pay is tied to the assessed value of your home. You pay a specific rate for every $1,000 in assessed value of your property.

How is the value of my property determined?

We’ve heard a lot of chatter in the media recently about assessed property values that have fluctuated significantly over the last year. Residential property values are reviewed and recalculated yearly by BC Assessment. Check out the video below to see how BC Assessment calculates the value of properties.

https://youtu.be/Ogy9CIlzupY

Much of the debate we see every year is about the timing of the assessments – properties are evaluated as of July 01 of the previous year. So, the assessments that will be sent out to BC homeowners in the new year were calculated as of July 01, 2019. This is important because property values have fluctuated significantly throughout 2019. The year started off quite slow, but by the fall, some areas were seeing sales activity that was signficantly above the 10-year average.

To help clarify this issue, I've provided some statistics below that show the fluctuation in property values over the last couple of years (using median sales price).

The point that I'm trying to make is that property values fluctuate throughout the year. The BC Assessment value of your property is a base line used to calculate your share of property taxes as of a specific point in time (July 01). The actual market value of your property will factor in the BC Assessment value, but more importantly, it will factor in recent sales data from the MLS system. Be careful of the weight you apply to a BC Assessment value because recent, accurate sales data will often tell a different story.

Don’t fear, an increase or decrease in your assessed property value doesn’t necessarily mean that you will see an increase in the amount of property taxes that you pay. Municipalities throughout the province use an averaging system that helps home owners that have been affected by high assessment increases. Detailed information on this system can be found here. 

What are my payment options and am I eligible for any grants?

The provincial government has a few grant options available when it's time to pay your property taxes. First, check to see if you are eligible to receive the grant! You need to claim the grant every year so don’t forget, but they can be claimed retroactively if you forgot. I’m going to focus on the basic grant because it's the most common, but there are additional grants available for seniors, veterans, and people with disabilities. Find more information on the grants here.

To be eligible for the basic home owner grant, you must meet the criteria:

  • Be a Canadian citizen or landed immigrant.
  • Ordinarily reside in British Columbia.
  • Be a registered owner or eligible occupant of your home.
  • Have the home be your principal residence (where you live and conduct your daily activities).

The property tax grant threshold is updated annually by the BC Government. For 2020, the basic brant will be available to homeowners of properties that have an assessed value of $1,650,000 or less. If your property has an assessed or partitioned value of $1,650,000 or less, the home owner grant may reduce your taxes up to $570 or, if it’s located in a northern and rural area, up to $770. 

There is also an option to defer the payment of your taxes if you're eligible. The deferral option is available to families with children, people that are 55+, surviving spouses, and people with disabilities. More information on the deferral program is available here.

I hope this blog has helped provide some clarification on property taxes, assessments, and grants in BC. If you have any questions or concerns about how these policies affect your property, please contact your local municipal government, an accountant, or a tax lawyer. 

Blog author image

Chris Lambert

Hi, I’m Chris. I help people like you to buy, sell, and invest in real estate throughout beautiful British Columbia. I love what I do, and I’d love to help you too. I'm an experienced and hard w....

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