Mortgage rates on the rise as lending rates are cut

When they talked about empty condos that would become available for rent, they never factored in that some of these are owned by people paying the Vacancy Tax. Those part timers are unlikely to rent their places out and even if they do they’ll only be short term.
Additionally I can see an increase in Speculators in the market now. They can rent the place until its time to flip it. Once again a short term solution.
 
Removal of the rental restriction on strata properties, would also expose all owners of strata housing units in major urban markets to the provincial speculation tax (or empty home tax) which currently exempts those units in strata buildings that don’t allow rentals, and a similar tax in the City of Vancouver.

“Yes, it dissolves the exemption category,” confirmed Tony Gioventu, executive director of the Condominium Homeowners Association of BC. (CHOA)

The speculation tax is applied for homes in B.C. that are left vacant, but the current law allows an exemption when “a covenant or a strata bylaw prevents the property from being rented out.” Lifting the exemption would mean that an owner would be subject to the tax, which is 0.5 per cent of the home’s value for B.C. residents and 2 per cent for foreign owners.

Strata owners in the City of Vancouver would also suddenly be subject to the Vancouver vacant home tax, which was recently increased to 3 per cent and which currently exempts units that are subject to a strata’s rental restriction.


BC Ends Rental and Age Restrictions for Strata Properties (Updated) – Barbeau Evans LLP

www.barbeau.co www.barbeau.co
 
Aquaholic said:
Removal of the rental restriction on strata properties, would also expose all owners of strata housing units in major urban markets to the provincial speculation tax (or empty home tax) which currently exempts those units in strata buildings that don’t allow rentals, and a similar tax in the City of Vancouver.

“Yes, it dissolves the exemption category,” confirmed Tony Gioventu, executive director of the Condominium Homeowners Association of BC. (CHOA)

The speculation tax is applied for homes in B.C. that are left vacant, but the current law allows an exemption when “a covenant or a strata bylaw prevents the property from being rented out.” Lifting the exemption would mean that an owner would be subject to the tax, which is 0.5 per cent of the home’s value for B.C. residents and 2 per cent for foreign owners.

Strata owners in the City of Vancouver would also suddenly be subject to the Vancouver vacant home tax, which was recently increased to 3 per cent and which currently exempts units that are subject to a strata’s rental restriction.


BC Ends Rental and Age Restrictions for Strata Properties (Updated) – Barbeau Evans LLP

www.barbeau.co www.barbeau.co
Click to expand...

is there a limit to how many units one owner could buy
 
Aquaholic said:
Removal of the rental restriction on strata properties, would also expose all owners of strata housing units in major urban markets to the provincial speculation tax (or empty home tax) which currently exempts those units in strata buildings that don’t allow rentals, and a similar tax in the City of Vancouver.

“Yes, it dissolves the exemption category,” confirmed Tony Gioventu, executive director of the Condominium Homeowners Association of BC. (CHOA)

The speculation tax is applied for homes in B.C. that are left vacant, but the current law allows an exemption when “a covenant or a strata bylaw prevents the property from being rented out.” Lifting the exemption would mean that an owner would be subject to the tax, which is 0.5 per cent of the home’s value for B.C. residents and 2 per cent for foreign owners.

Strata owners in the City of Vancouver would also suddenly be subject to the Vancouver vacant home tax, which was recently increased to 3 per cent and which currently exempts units that are subject to a strata’s rental restriction.


BC Ends Rental and Age Restrictions for Strata Properties (Updated) – Barbeau Evans LLP

www.barbeau.co www.barbeau.co
Click to expand...
That's important. I wonder what the net impact would be in the end. I'm sure someone smarter than us has already worked that out, right? More money in the governments pockets doesn't help the housing situation whatsoever
 
Rain City said:
That's important. I wonder what the net impact would be in the end. I'm sure someone smarter than us has already worked that out, right? More money in the governments pockets doesn't help the housing situation whatsoever
Click to expand...
No, but if it forces people to sell properties that they are sitting on and that is a good thing. Investors sitting on properties not renting them out or occupying them does very little for broader economy.
 
Rain City said:
Even if there was, theres no limit to the amount of shell companies an owner can be involved in. There's always a way.
Click to expand...

would be **** to be stuck in a strata where some foreign investor has controlling vote share.
 
dradons said:
No, but if it forces people to sell properties that they are sitting on and that is a good thing. Investors sitting on properties not renting them out or occupying them does very little for broader economy.
Click to expand...
I don't think it's enough to scare the buy and hold crowd away. They'll likely find another loophole like renting it to a family member.
 
Fair enough, thank you for the clarification, Dradons.
Net tax to the company is 30% then? After a further 25% on the dividend where do we end up?
Its dificult to work out the best path when trying to save for retirement.
Any insight you or anyone else are willing to provide is appreciated!
dradons said:
This is not quite correct. The income in the corporation is originally taxed at 50.67%. Once you pay the dividend out the company will receive a refund of tax of 20.67%. Net tax in the corporation for investment income is 20% once the profits have been distributed
Click to expand...
 
InterMechanico said:
Fair enough, thank you for the clarification, Dradons.
Net tax to the company is 30% then? After a further 25% on the dividend where do we end up?
Its dificult to work out the best path when trying to save for retirement.
Any insight you or anyone else are willing to provide is appreciated!
Click to expand...

Sorry, the refund is actually 30.67% the net tax in the company is indeed 20%.

There is a couple of percentage-point penalty for holding investment income in corporations. The aim of taxes "generally" is to be relatively integrated(ignoring tax brackets and deferrals) for income earned personally vs in a corporation.
 
InterMechanico said:
Fair enough, thank you for the clarification, Dradons.
Net tax to the company is 30% then? After a further 25% on the dividend where do we end up?
Its dificult to work out the best path when trying to save for retirement.
Any insight you or anyone else are willing to provide is appreciated!
Click to expand...


Ok here goes .

None of what I am writing should be viewed as anything more than idle chatter on a fishing forum.

Each of you will have unique and different circumstances that will require a certain level of professional accounting and /or legal advice.

Nothing I am writing should be viewed as professional advice.

For the self employed who own a company consider making the maximum available RRSP contribution for the upcoming year into your RRSP January 1st.

For employees who do not have the advantage of an RRSP or Pension Plan (Defined Contribution or Defined Benefit ) consider making monthly RRSP contributions and fill out a T1213 Request to Reduce Tax Deductions at Source and give it to your employer. That way you won't be lending interest free money to the feds as you wait for your tax refund at the end of the next tax year .

For the self employed make sure you contribute to the CPP . The immense value of the CPP is for the most part misunderstood by far too many Canadians.

For your RRSP investments, find ones with the low fees, and consider at Target Date and /or asset allocation funds from firms like Black Rock , Vanguard, etc. (not a recommendation just an example) If over 40 years you can have growth close to what the large pension funds have you will have done well.

A lot of people have the belief that RRSPs are a bad deal. That is their belief and I am not interested in engaging in discussion to change anyone's opinion.

If you own a profitable business you have more options to save inside your company. If you are doing well and/or expect to, make certain that you pay for good tax and legal advice. Good tax planning advice may include the setting up of Holding and/or Management Companies and Trusts.

Couples who have 2 million plus in their RRSPs usually started saving when they were younger and maximized their RRSP contributions as soon as possible.

Unbiased education ( nothing is being sold or promoted )

Here is a link to a good retirement calculator.

Canadian Retirement Income Calculator - Canada.ca

Canada Pension Plan
www.canada.ca www.canada.ca

Note I didn't mention TFSA's there are lots of articles comparing TFSA and RRSPs. Educate yourselves on these plans

The Chartered Professional Accounts have put together an excellent program on Retirement Planning

www.cpacanada.ca

Planning for retirement

How to effectively plan for the kind of retirement you desire.
www.cpacanada.ca www.cpacanada.ca

They will even provide free Retirement Planning Workshops you have to book it ahead a specific number of weeks

I think nothing would be more entertaining than if a group of Sport Fisherman requested a free meeting on retirement planning.

I hope that helps.
 
wildmanyeah said:
can you still elude taxes by dividend's out your profits to your kids?
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It hardly evades tax I think. Kids pay tax on it, and it’s another account that the accountants can bill you for to sort it all out. At least that’s the impression I got. My pops set us up with one with enough for a down payment on my first condo quite a while ago and he said it was a waste of time and money after years of accountant fees.
 
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dradons said:
No, but if it forces people to sell properties that they are sitting on and that is a good thing. Investors sitting on properties not renting them out or occupying them does very little for broader economy.
Click to expand...
Not sure it would have much of an impact. Last year apparently 100,000 people moved to BC. The Feds are calling to up immigration from outside of Canada to 500,000 a year. Many of these people will choose to live in BC. Not sure even if all investors were to sell their properties if this would rebalance the supply and demand issue. Also some people are happy to live here part time and pay the vacancy tax. Would be interesting to see an actual number of vacant units.
 
I really object to the gov't forcing the private sector to solve an outstanding social issue vis -a-vis housing. Low cost housing is a gov't issue that needs to be solved by gov't not by taxing private land owners out of their vacation homes or cottages. Time the gov't stopped looking at private ownership and capital gains of hard working families as a Piggy Bank that the gov't can tap to alleviate their responsibilities for social housing
 
spring fever said:
I really object to the gov't forcing the private sector to solve an outstanding social issue vis -a-vis housing. Low cost housing is a gov't issue that needs to be solved by gov't not by taxing private land owners out of their vacation homes or cottages. Time the gov't stopped looking at private ownership and capital gains of hard working families as a Piggy Bank that the gov't can tap to alleviate their responsibilities for social housing
Click to expand...
Apparently they're doing a really good job of taking our money too. 5.7B suplus?!
 
I went with a broker last time. They go to bat for you, and don't cost you any money. Do all the work and make the process easy. If they are good that is. It's a no brainer
 
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