Property Taxes 101 – Metro Vancouver Real Estate Update 2012
What are property taxes?
An annual local government tax levied on real property based on BC Assessment’s estimated market value. Local governments calculate the tax by dividing the annual budget by total assessed property values. In rural areas, the province assigns the tax rate. Rates vary among property classes: residential, business, light and heavy industry, farm, recreation, utility and managed forest land.
The assessed value of each property is typically determined annually by BC Assessment, as of the previous July 1.
Where do I find out what my property taxes are?
Look at your tax notice which was delivered by mail in late May or early June. You can also check your local government web site, which may have information. For example, the City of Vancouver has a property tax web page where you can find your account balance. For information contact your local government tax office or BC OnLine.
What happens if I don’t get a tax notice?
You must pay whether or not you have received a notice. Contact your local government finance department and arrange for a duplicate notice. You must ensure that your local government and BC Assessment have your correct mailing address.
Five misconceptions about property taxes
1. You can appeal property taxes. No. You can appeal your assessment, not your taxes. You annually receive your assessment the first week of January and must appeal by January 31.
2. An appeal will change the market value. The market value may not correlate to the assessed value. BC Assessment typically assesses properties as of the previous July 1. A REALTOR® valuing a home now — 11 months later — may find the market has changed, the home has had an addition or the street has been re-zoned, all of which affect value.
3. If you just bought a home, the previous owners are liable for taxes. No. When you buy a property you become liable for all outstanding taxes.
4. New home owners can claim the Home Owner Grant. No. New home owners cannot claim the Home Owner Grant if the seller paid the taxes or if the new home owner claimed a grant on another property.
5. You haven’t claimed your Home Owner Grant for a few years and you want to claim it all now. You’re out of luck. You can claim the grant amount only for the previous year.
What taxes do property owners pay?
Take a close look at your property tax notice. About 50% of the amount owing is levied by the local municipality. Municipalities are also required to collect the remainder for other taxing authorities and have no control over these levies.
Municipal tax — is set by council and staff in the local government’s annual budget process and is based on revenue needs for infrastructure and services.
Regional district tax — is set by the regional districts for key services such as regional water and sewage treatment. For example, Metro Vancouver tells their local governments what their revenue needs are, and the local governments collect on their behalf. In rural areas, the province (Surveyor of Taxes) collects for regional districts.
School tax — is set by the BC Government to fund schools and varies by local government. It’s paid by residential and non-residential property owners.
Hospital tax — is set by the regional hospital districts to help partially fund local health facilities. For example, in Metro Vancouver hospitals are funded by the province, not by property taxes. Outside Metro Vancouver, hospital taxes are still levied.
Other taxes — are set by local taxing authorities and collected by the local government to fund BC Assessment, the Municipal Finance Authority and TransLink.
For questions about taxes levied by other taxing authorities, contact:
- BC Assessment Authority, 604.241.1361
- Greater Vancouver Transportation Authority (TransLink), 604.453.4000
- Metro Vancouver, 604.432.6200
- Municipal Finance Authority, 250.383.1181 (Victoria)
- School Taxes, 250.590.0239, (Ministry of Finance, Victoria)
How to pay property taxes
Visit your local government’s web site for details on how to pay. Then check the due date on your tax notice, complete the Home Owner Grant application and then pay:
Online by www.epost.ca: you must first sign up for this free online Canada Post delivery service that lets you pay electronically. When you pay and claim your Home Owner Grant electronically, you’ll receive a receipt with a confirmation number
In person: take your tax notice and a credit or debit card, your cheque book, a certified cheque or cash to your local government finance department. Check business hours
At the drop box: located near the front entrance of most City Hall offices. There may be drop boxes in alternate locations as well
By mail: your payment must arrive at City Hall by the due date on your tax notice
At a financial institution: most banks and credit unions accept tax payments in person. You can also pay online or by phone through your bank or credit union. Remember to submit your Home Owner Grant form directly to City Hall
Through your mortgage: your mortgage company can pay your property taxes on your behalf if you arrange for this service beforehand
By installments: check with your local government to see if prepayment options are offered.
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 tax notice), 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 outstanding taxes as a penalty. If taxes are unpaid after three consecutive years, the property may be auctioned. Tax sale dates and processes can be found on local government web sites.
The upside of property taxes?
Property taxes help fund a range of local capital projects and services, including:
- Animal control and shelters
- Bicycle lanes/paths/walkways
- Building regulation
- Community centres
- Energy efficiency upgrades
- Environmental protection
- Garbage and recycling
- Heritage planning
- Local road maintenance
- Parks/trails/green space
- Police/fire/emergency services
- Safe drinking water
- Sewage treatment
- Swimming pools/tennis courts/skating rinks/playing fields
If you have any real estate questions or if you are thinking of buying or selling your home, please contact James Louie Chung, Metro Vancouver REALTOR® — Real Estate Agent at [email protected] or call / text ( 6 0 4 ) 7 1 9 — 6 3 2 8 today!