To sell a property in B.C, it is necessary for you to list it first. Once the property is listed for sale, and the offer to purchase the property has been accepted by the sellers, there is a binding contract to sell the property. This is a legal document that is necessary for both sides to honor their side of the deal. To complete this deal, the seller must employ the service of a lawyer.
Closing costs and non-residential seller procedure are the two things which every seller usually consider.
Once a property is at closing, there are few closing costs every seller need to take note of. If necessary, these costs will come directly from sale. There are various types of commissions:
- Realtor Commissions – The seller always take the responsibilities of paying both realtors commission. Commission fees for the selling and buying agent are subjects to change and GST
- Mortgage payouts – If there is mortgage on the property, it has to be fully paid. This particular type of mortgage payout will cover all and any payment penalty that is applicable under the mortgage terms. It is necessary for each seller to contact his or her mortgage broker before selling the property, so as to determine how much the payment charges is going to be. By doing so, you will avoid surprises at closing
- Deferred or Delinquent Property Taxes – Any deferred or delinquent property taxes must be fully paid in order to continue with the sale procedure and for the property transfer to occur.
- Adjustments – These adjustments opportunity are always few, either in form of debits or credits that pro-rate for property taxes, strata fees, municipal utilities, and in case the property is tenanted, rental income and security deposits.
Legal fees usually fall between $600-$1000, regardless of whether you choose to retain the service of a public notary or a personal real estate lawyer. Legal fees cannot be avoided but are likely to change if there exist any special request or reasons for the lawyer to put additional work or time to it.
Withholding a portion of the sale proceeds until a non-resident seller provides you a Clearance Certificate from the Customs and Revenue Agency is the only way you can avoid liability from a non-resident sellers unpaid taxes. The withholding can go from 25% upward depending on the property use.
So as to help in obtaining Clearance Certificate from the Customs and Revenue Agency, a non-resident seller should employ the service of a tax professional. This should be done as fast as possible since the whole process can be completed within 8 weeks. A Clearance certificate is usually issued once the tax has been fully paid. Customs and Revenue Agency will require payment of any other taxes outstanding or payable by the seller, while reviewing whether or not capital gains tax is payable. The commission, tax and legal fees on the sale cannot be deducted for the purposes of calculating tax owing at the time of the sale. The non-resident seller can claim these expenses by filing a tax return following the sale.