Billionaire’s relationship with luxury BC mansion highlights property tax gap

A billionaire’s affair with a luxurious Vancouver Island mansion is a results of some costly BC transfers of property switch and overseas purchaser taxes.

The CBC introduced final month that Russian-born billionaire Yuri Milner is the person behind the belief that purchased the $18 million Mille Fleurs mansion in 2013 – seven years earlier than the oceanfront property was reportedly residence to Prince Harry and Meghan Markle, they hatched plans to step again. from royal duties.

However past the intrigue in regards to the mansion’s possession, the investigation additionally highlights an uncommon property registration scenario that predates the condominium laws handed within the Nineteen Sixties.

In a nutshell, Mille Fleurs is the Towner Bay Nation Membership Ltd., which was based in 1929. It’s certainly one of a sequence of properties positioned on a bigger plot of land owned by an organization often known as The bigger plot is undivided and the entire residences throughout the homeowners are the shareholders of the corporate.

When a home is offered, particular person shares change arms, however the sale of quite a bit doesn’t have an effect on the possession of the bigger plot, that means there is no such thing as a course of to register with the Land Registry – and, because of this, no funds. property switch or overseas purchaser taxes.

‘The loopy world of taxation’

There is no declare that anybody has accomplished something improper – it is simply the way in which the land title on sure properties is grandparented.

An identical scenario involving Nineteen Sixties residence buildings on Vancouver’s West Finish trumpeted the truth that “NO FOREIGN BUYER TAXES and NO PROPERTY PURCHASE TAX” had been on actual property brokers’ listings of multimillion-dollar residences overlooking English Bay.

Meghan Markle and Prince Harry in New York in September 2021. On the proper, the couple stays within the winter of 2020 as they put together their plans to step again from their official royal duties. Mille Fleurs mansion in northern Saanich. (Roy Rochlin/Getty (left); Sothebys (proper))

“These items dwell in their very own bizarre world of taxation,” says Ron Usher, normal counsel for the BC Notaries Society.

Usher has with curiosity cataloged what he calls “historic anomalies”, such because the Towner Bay and West Finish residence complexes – so as to add one other layer of confusion – often known as co-ops however not of the identical sort as current rental co-ops. BC as inexpensive housing

He says they’re in all probability finest described as “housing corporations” that had been created previous to the Strata Title Act of 1966 as a approach for individuals to take frequent possession of the constructing the place their flats are positioned.

Comparable possession buildings exist within the previous three- and four-story buildings scattered across the Decrease Mainland – usually shocking consumers once they be taught their particular person models haven’t any strata caps.

“I feel the necessary level to emphasise is – they solved an enormous housing downside for lots of people earlier than we had layers,” Usher says.

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