Investor · Structure
Some BC real estate investors hold property through a corporation rather than personally. The decision affects taxes, liability, financing, and the BC Property Transfer Tax. Here's the framework.
Verified · Investor · Structure
Property Transfer Tax
Corporate purchases pay the same PTT as individual purchases. Some related-party transfers between a corporation and shareholders may have specific rules.
Foreign buyer additional PTT (20%)
Applies to foreign-controlled corporations purchasing residential in Greater Vancouver including Coquitlam.
Income tax treatment
Rental income at the corporate small-business rate (~12% combined federal+BC for active business income, varies). Passive investment income (rental from arms-length tenants) is taxed differently.
Capital gains in a corporation
Corporate capital gains have different tax treatment than personal — capital dividend account, refundable Part IV tax. Talk to a tax accountant.
Liability protection
Corporate ownership can provide some liability separation from personal assets.
Mortgage financing
Many lenders require personal guarantees from corporate shareholders. Corporate-only mortgages are rare without significant track record.
BC Speculation Tax
Corporations face the same SVT rules; foreign-controlled corporations face the higher 2% rate.
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