Property Transfer Tax Act Information Collection Regulation
Agenda Mandate Purpose & Scope of Legislative Amendments Policy And Legislation- legislative concepts Implementation: PTT Return v.31 “feel and look” Recommendations & Resources Q & A 2
MANDATE HOMES FOR B.C. A 30-POINT PLAN FOR HOUSING AFFORDABILITY IN BRITISH COLUMBIA Increase certainty of true ownership of real estate and create transparency Respond to concerns about outside investment fuelling property prices in B.C. Close loopholes Prevent fraud and tax avoidance Enhance data collection to inform strategies that result in an increase of housing stock and affordability 3
PURPOSE Increase evidence of true real estate ownership Improve tax liability compliance Reduce tax evasion and tax fraud Streamline with and complement other B.C. government initiatives, such as: Registry of beneficial ownership of real estate (stock) Registry of pre-sale condominium contract assignment Federal-Provincial working group on tax fraud & money laundering Increase intergovernmental collection and sharing of information 4
SCOPE Regulation of the Minister of Finance and Deputy Premier under the Property Transfer Tax Act (PTTA) information collected on the PTT Return * upon registration of title in the land title office (LTO) applies to all property types and classes the collection of information is subject to section 32 of the PTTA privacy protection and confidentiality rules *Not retroactive Effective September 17, 2018 5
LEGISLATIVE CONCEPTS “RELEVANT CORPORATION” A corporation OR a limited liability company “RELEVANT TRUST” An express trust OR a legal relationship created in another jurisdiction similar to a legal relationship created under an express trust “CORPORATE INTEREST HOLDER” An individual in relation to a relevant corporation, who: has legal and beneficial ownership OR has direct or indirect control of shares representing 25% or more of the relevant corporation's equity • OR 25% of voting rights in respect to the relevant corporation • has direct or indirect right to appoint/remove the majority of the board of directors of the relevant corporation has the right to exercise under unanimous shareholder’s agreement or otherwise, significant influence or control over the relevant corporation. 6
LEGISLATIVE CONCEPTS Direct vs Indirect interest, control, power/right Interest, power or right alone together with one or more persons w/ common interest through a corporation a trustee of a relevant trust or any trust a personal or legal representative an agent or any intermediary 7
INFORMATION DATA ELEMENTS TRANSFEREE RELEVANT CORPORATION or TRUSTEE of RELEVANT TRUST w/ 1+ relevant corp. beneficiaries Collects & states information on each “CORPORATE INTEREST HOLDER” Name • Date of birth • Citizenship • Tax identification numbers: SIN, SIN/ITN • Contact information • 8
INFORMATION DATA ELEMENTS TRANSFEREE = TRUSTEE of “RELEVANT TRUST” Collects & states information on EACH beneficiary INDIVIDUAL CORPORATION Name Name of each director • Date of birth Date of birth of each director • Citizenship Citizenship of each director • Tax identification numbers: SIN, ITN Tax identification numbers: SIN, ITN • Contact information Contact information • 9
INFORMATION DATA ELEMENTS TRANSFEREE = PUBLIC COMPANY* States the name of public company * as defined in section 1(1) - Business Corporations Act TRANSFEREE = holds on behalf of or is a PARTNERSHIP/s States whether the property is a partnership property ** **as defined in section 1.1 – Partnership Act 10
IMPLEMENTATION WHEN Registration in the land title office, and filing of the PTT return on or after September 17, 2018 WHOM (from) Transferee files the PTT return after collecting the information from: • Beneficiaries of trusts • Individuals who are corporate interest holders • Partnerships and public companies* WHOM NOT (from) EXCLUDED CORPORATIONS (e.g., gov. bodies, financial institutions etc.) EXCLUDED TRUSTS (e.g., PGT, pension trusts, RIT, SIFT, mutual funds etc.) TRANSFEREES (of EXCLUDED TRANSFERS) • INDIGENOUS NATION** • COPORATIONS whose shares are owned by Indigenous nation /band as def. in Indian Act (Canada) • TRUSTEE of a trust for the benefit of Indigenous nation /band as def. in Indian Act (Canada) * disclose solely the legal name of the partnership or the public company ** defined s.1 of the REG. to include:Nisga’a Nation/Village, treaty first nation, Sechelt Indian Band/Gov. District, Westbank First Nation 11
IMPLEMENTATION PTT RETURN v. 31: “Feel and Look” PART A- Purchaser/Transferee two additional questions SETTLOR AND BENEFICIARIES page 12
IMPLEMENTATION DIRECTORS OF CORPORATION page 13
IMPLEMENTATION CORPORATE INTEREST HOLDER – NEW page 14
RECOMMENDATIONS All purchaser/transferees will answer specific Qs on the PTT Return to determine whether the Information Collection Regulation applies to the transfer they are registering in the land title office • For all property classes • Additional information is collected from beneficiaries of trusts or corporate interest holders of corporations (unless exempt) The collection of information is mandatory and reasonable effort should be made to obtain the information Section 10 of REG. provides a description of efforts in the context where the information can not be obtained; the transferee is required to attach to the PTT Return a description of the efforts The collection of the information is not retroactive; it is effective September 17, 2018 onwards • PTT Return v. 30 remains in use till the end of day Sept 16, 2018 • PTT Return v. 31* is required for all transfers with a land title registration date of Sept. 17 or later * No software changes are required for the use of the PTT Return V.31 15
RESOURCES Online: gov.bc.ca/propertytransfertax Toll free in Canada: 1 888 355-2700 Email: pttenq@gov.bc.ca Subscribe to our What's New page to receive email updates 16
REFERENCES Property Transfer Tax Regulation: http://www.bclaws.ca/civix/document/id/mo/mo/2018_m287 Property Transfer Tax Act: http://www.bclaws.ca/EPLibraries/bclaws_new/document/ID/freeside/00_96378_01 B.C. legislation referenced Business Corporations Act Partnership Act Budget Transparency and Accountability Act Financial Administration Act Freedom of Information and Protection of Privacy Act Community Charter and Local Government Act Pension Funds Societies Act Other… Federal legislation - https://www.canlii.org/en/ca/ Sechelt Indian Band Self-Government Act (Canada) Bankruptcy and Insolvency Act (Canada Income Tax Act (Canada) Indian Act (Canada) 17
QUESTIONS? 18
The information provided in this presentation is an aid to understanding the legislation and is not intended to replace the legislation.
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