Deferring Property Taxes
In British Columbia and in several other provinces in Canada, there are programs in place that enable you to defer your property taxes. Each province’s program is a little different, but here is how the one in British Columbia works.
The program began in 1974, and it was established to protect homeowners who were having difficulty paying their property taxes. The idea was that if the burden of property taxes was lifted, the taxes could be paid at a later date, such as when the property was sold.
To qualify for this program, you have to be 55 years or older, or a homeowner who financially supports a dependent child. You also need to have at least 25% equity in the property, and all previous property taxes and fees must have been paid up to date.
The property tax deferral program functions like a loan. BC is loaning you the money, paying your taxes, charging simple interest, and you agree to repay the loan for the payment of these property taxes when certain conditions are met. The good news is that if the interest charged is low, and the potential for return on another investment is higher, then what you would have paid toward property tax can be used as a source of income to invest for higher returns--indefinitely. And, the fact is that interest rates are so low right now, many individuals are doing just that: borrowing money at a low interest rate to invest for a higher return.
There are three things to keep in mind:
- You do have to qualify for it.
- You do have to pay it back when certain conditions are met.
- You will have to verify that deferring property taxes does not conflict with the terms of a mortgage that you may have in place.
If deferring your property taxes appeals to you, then feel free to contact Noah Belcher to talk about that and your investment possibilities. His office number is (604) 535-3454.
Noah Belcher is an Investment Advisor with iA Private Wealth Inc., and is a CERTIFIED FINANCIAL PLANNER® professional and a Chartered Investment Manager (CIM®), who helps his clients achieve their financial goals and objectives. He offers personalized solutions and stellar customer service to clients with complex tax profiles who require top-notch advice.
If you have any questions about this article or would like to talk to him about your financial profile, call his office at (604) 535-3454.
This information has been prepared by Noah Belcher who is an Investment Advisor with iA Private Wealth Inc. Opinions expressed in this article are those of the Investment Advisor only and do not necessarily reflect those of iA Private Wealth. The information contained herein may not apply to all types of investors. iA private Wealth Inc., is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada.