Yaletown properties assessments reduced

THE PROPERTY ASSESSMENT Appeal Board has approved a joint recommendation from Bosa Development (Pacific Point) Inc. and B.C. Assessment’s area assessor for the Vancouver Sea to Sky Region to reduce the valuations on nine addresses on the northwest edge of Yaletown.

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Reblogged from The Georgia Straight | Charlie Smith

In 2013, Bosa Development completed the Pacific Point project at the corner of Homer and Pacific streets.

For 425, 427, and 429 Pacific Street, there were reductions of 6.7 percent, 17.8 percent, and 15.8 percent, respectively.

These three properties were initially assessed at $900,500. As a result of the agreement, the three sites are now valued at $790,000.

Six other addresses in the 1300 block of Homer experienced a collective drop in assessment from $2.5 million to $2.3 million. For these six sites, the average reduction was seven percent.

In each instance, the value of the land was reduced but the value of the “improvement” (i.e., the building) remained the same. This indicates that under certain circumstances, B.C. Assessment may be prepared to make adjustments on its assessments of land in the downtown core.

Lower assessed values translate into lower property taxes. That’s because municipal and school levies are based on B.C. Assessment’s valuations.

The head of Bosa Development, Nat Bosa, was in the news late last month after he and his wife bought the famed 106-year-old Empress Hotel in Victoria. The Bosas purchased the 477-room hotel from Ivanhoé Cambridge for an undisclosed price.

The Empress Hotel was designed by architect Francis Mawson Rattenbury. His fame increased after he was murdered in England in 1935 by his wife’s lover.

In addition to designing the Empress Hotel, Rattenbury was the architect of the neighbouring parliament buildings in Victoria and the Vancouver Art Gallery.

Read the original article and more here.

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Questions for Property Transfer Tax (BC)

20140219-224133.jpgIf you are like me, then you probably have tons of questions about Property Transfer Tax. Do I have to pay it? What happens when I sell my house? What if I want to give my house to my children? Are there any rebates, discounts or first-time homebuyer benefits?  I’ve come across a nice article from David Simon – which is quite helpful in some of the odd particulars of Property Transfer Tax, like adding someone’s name to title – does that constitute a sale subject to property transfer tax? I’m by no means an expert nor a lawyer – should you consult your own lawyer if you have a particular situation or question? Yes. If you want to shoot me over a quick question, or get some recommendations on who you should really be speaking to, please hit up the comment section below or on my contact form.

For all you lucky Albertan’s, you’ve probably never encountered nor will you ever hear about this strange thing we call property transfer tax.

“I am often asked how a person can add someone to a title without paying property transfer tax. Usually that person contributed to the acquisition and has been helping paying the mortgage. Unless the person is a “related individual” as defined in the Property Transfer Tax Act and the transferor or the transferee has been living there as his/her principal residence for at least 6 months, then property transfer tax has to be paid. A related individual under the Act is a direct relative, e.g. son, daughter, parent grandparent. Siblings and aunts and uncles do not fall within the definition and the transfer tax has to be paid for transfers to them.

 I have been asked if a company can transfer its property free of property transfer tax to its shareholders. The answer is no as the company is a separate legal entity from its shareholders. Only if the company was holding the property in trust and the trust declaration was registered when the transfer to the company was registered, can the transfer be done free of property transfer tax.

 From an income tax point of view, the law is that on any disposition, or deemed disposition, of capital property, tax is payable on any capital gains. The main exception to this is for dispositions of a primary residence. There is no tax payable on the capital gains from a disposition of a primary residence.  A deemed disposition occurs when a person dies, there is a gift of property or there is a change of use of the property, e g. it goes from being your primary residence to a rental property, or from a rental property to being your primary residence. The gain has to be determined at that time and any applicable tax paid. So before anyone takes title to, or transfers title to, all or part of a primary residence or any other property, even if a family member is involved, they should consult with their tax advisor as to possible tax consequences. Once you do something it is difficult and potentially costly to undo it.”

Tax Tips – First-Time Donor’s Super Credit

“If you’re among the almost 75% of Canadians that hasn’t been giving anything to charity or at least haven’t in some time, you can take advantage of the new First-Time Donor’s Super Credit (FDSC). Under the general rules, individuals can claim a non-refundable tax credit of 15% for the first $200 of annual charitable donations. That tax credit rate jumps to 29% for any donations above $200.”

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Reblogged from Jamie Golombek

There might be more than a few of us hanging our heads as we skulk past the Salvation Army kettles, hands in our pockets and eyes averted, after a survey this week pointed out that we are donating not only fewer dollars but also a declining percentage of our income to charity than in prior years.

According to the Fraser Institute’s annual “Generosity Index” released earlier this week, a lower percentage of tax filers donated to charity in Canada (22.9%) than in the United States (26.0%). Similarly, Canadians (at 0.64%) gave a lower percentage of their aggregate income to charity than did Americans (at 1.33%).

So, if your lack of giving during this holiday season is causing you some guilty pangs, there are actually a couple of ways to make giving a bit less unsettling by using the tax rules to decrease your after-tax cost of donating.

But to encourage “new” donors to give to charity, the 2013 federal budget introduced the temporary FDSC which provides an additional 25% non-refundable tax credit for a “first-time donor” on up to $1,000 of donations. A first-time donor is someone who hasn’t claimed a donation credit after 2007. If you’re married or living common law, neither you nor your spouse qualify if either of you has made a donation after 2007. While first-time donor couples can share the FDSC in a particular year, the total amount claimed can’t exceed the maximum allowable credit.

As a result, a first-time donor will be entitled to a 40% federal credit for donations of $200 or less and a 54% credit for donations over $200 up to $1,000. Only cash donations will qualify for the FDSC as opposed to donations of property or donations “in-kind.”

The FDSC is available for donations made on or after March 21, 2013 and the credit can only be claimed once in either 2013 or any year until 2017.

Read More … 281 more words

Does your home office qualify for deductions against household bills?

If you were self-employed this past year, now is a good time to start gathering your paperwork to file your 2013 tax return. And remember some of the expenses you incur for your home may be deductible from business income if you have an office or other work space there.

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Reblogged from KPMG Enterprise

Your home office expenses may be deductible in two situations: First, if your home is your principal place of business — that is, you do not have an office elsewhere. Second, if you have an office outside your home, your home office must be used exclusively for your business, and must be used on a “regular and continuous basis” for meeting clients, customers or patients.

It’s not always clear how many meetings you need to have in your home office to meet the “regular and continuous” requirement, but it will depend on the nature of your business and your situation.

The Canada Revenue Agency provides an example of a doctor who has offices both outside and inside his home. He uses his home office to meet one or two patients a week. The CRA says this work space would not be considered used on a regular and continuous basis for meeting patients. However, a work space used to meet an average of five patients a day for five days each week clearly meets the requirements. This example clearly shows there is a large grey area in what the CRA considers to be regular and continuous.

If you have offices inside and outside your home and you want to deduct home office expenses, be prepared with enough information to support your claim that you use your home office on a regular and continuous basis for your business.

If your home office meets the requirements, the portion of your house expenses that can be claimed as business expenses will normally be based on the fraction of your home used. You can usually exclude common areas such as hallways, kitchen and washrooms when making the calculation.

For example, if your home office is a 200 square foot room (or 18.5 square metres) and the total area of living space in your house (bedrooms, living room, dining room and the office) is 2,000 square feet (186 square metres). As long as your home office qualifies, you can claim 10% of your eligible costs.

The expenses you can claim include rent, if you are a tenant, mortgage interest if you own your home (but not the principal portion of blended mortgage payments), property taxes and home insurance. You can also claim expenses for utilities such as electricity, heat, water and gas.

But there are also some less obvious expenses that can be claimed, such as garden service, driveway snowplowing and minor repairs. You will need to keep receipts on file; do not simply estimate your expenses.

You can claim capital cost allowance (CCA) on the appropriate fraction of your home, but this is often not advisable. If you do, the CRA will take the position  that fraction of your home is not part of your principal residence and it will disallow your claim for the principal residence exemption from capital gains tax for that portion of the home when you sell. Any CCA you claimed can also be “recaptured” into income when you sell your home.

Keep in mind home office expenses can only be claimed against income from your business. As such, you cannot use home office expenses to produce an overall business loss that is applied against other income. However, losses disallowed because of this rule can be carried forward and used against income generated from the same business in another year.

Of course, supplies that relate exclusively to your home office are fully deductible and not subject to these restrictions. Those expenses would normally include a separate business phone and Internet connection, printer paper, printer or photocopier toner cartridges, computer repairs (assuming your computer is used only for your business), and so on.

Since many of the requirements for deducting home office expenses depend on your individual circumstances, it’s important to carefully document your claims so you can back them up if the CRA asks you to.

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