If you are a homeowner or are considering buying a home, “property taxes” is a term that you should be familiar with.
Many people, although familiar with the term, are not quite sure exactly what property taxes are. We understand that we have to pay them, but what are they exactly? Below are some common questions and answers, which will hopefully help provide you with a better idea of how property taxes work in Vancouver.
What are property taxes?
Property taxes are an annual local government tax levied on real estate. In BC, the amount of tax is based on the estimated market value. Municipalities calculate the tax by dividing the annual budget by total assessed property values
In rural areas, the province assigns the tax rate. Property taxes differ depending on the type of real estate: residential, business, light and heavy industry, farm, recreation, utility, and managed forest land.
The assessed value of each property is typically determined annually in July by BC Assessment, who develops and maintains real property assessments throughout British Columbia. The BC Assessment is rolled out the following January.
When are property taxes due?
Property Taxes are due twice per year. The second business day in February and July. If your payments are late, you are liable for an interest penalty of 5%.
What are advance property taxes?
Advance property taxes are half of your tax amount for the year. Advance tax notices are issued the last week of November, and are due on the second business day in February. Main taxes are due on the 2nd business day in July.
Where do my property taxes go to?
Property taxes are one of the City’s biggest revenue sources and are critical to the health and livability of our city. Property tax payments help fund the following:
- Essential services like police, fire fighting, and emergency rescue
- Stronger communities and services for the disadvantaged
- Recreation and community centres, libraries, parks
Where do I find out what my property taxes are?
The first place to look to find out what your property taxes are would be your tax notice, which is usually delivered by mail in late May or early June. You can also check your local government web site for this information. For example, the City of Vancouver has a property tax web page where you can check your account balance. For more information contact your local government tax office or BC OnLine.
What if I didn’t get a tax notice?
It is your responsibility and you should either phone or visit the local municipal tax department and request a duplicate tax bill if you did not receive one. Not having received your tax notice is not an excuse for not making your payment on time and you will still be held liable if your payment is late, for any interest or penalties. Make sure your local government and BC Assessment have your correct mailing address. You can also contact the BC Land Title and Survey Authority at 604.660.0380 for a Certificate of Title to prove ownership.
What is a home owner grant?
If you have a residential property, and you reside in it as your primary residence, you may qualify for a grant. Each municipality has different stipulations to qualify for the grant. You should complete the Home Owner Grant application. In order to avoid late penalties, property taxes must be paid and the Home Owner Grant must be claimed prior to the property tax due date.
What are my payment options?
You have 3 options to pay your taxes.
- You can pay the full amount all at once when they are due on the due date.
- Your mortgage lender can take payments for the property taxes for you and pay them on your behalf when they are due. Note, if you select this option, you are required to fill out the home owner grant forms and submit to your municipality. You will still receive the tax bill, and for most municipalities the home owner grant application is a part of the bill.
- You can set up an automatic debit with your municipality and pay them monthly in advance directly.
What if a home owner doesn’t pay their property taxes?
If a property owner doesn’t pay their property taxes by the due date (check the most recent tax notice for specific dates), and doesn’t submit the Home Owner Grant form by the due date, there are serious consequences.
The property owner will be charged a percentage of the outstanding taxes as a penalty. If taxes remain unpaid, there becomes an arrears build up and after three consecutive years of accumulated arrears, the property may be auctioned! Tax sale dates and processes can be found on local government web sites.
Can I receive my property tax and utility notice online or via email?
Municipalities are now capable of delivering property tax and utility notices electronically, if requested. To choose e-billing, visit your local municipal website and search for Property Taxes or look for the e-billing option.
Still have some questions? Leave us a comment below and we’ll try to help provide you with further clarity!
Written by: Aleem Peermohamed