Effective January 1, 2019, BC developers who market residential strata lots are now responsible for providing specific information to the Condo and Strata Association Integrity Register (CSAIR) on all assignments of pre-sale condo and strata lots. The regulation was launched on November 5, 2018 by the Government of BC as a way to create greater transparency and make sure that people who are assigning presale units are paying the applicable income taxes.
The purpose of this blog is to provide an overview of the regulations. As with any new regulation, it’s always important to do your own research into the requirements and seek legal advice as needed.
CSAIR is an online database containing comprehensive information on the assignments of purchase agreements of pre-sale condo and strata lots. The purpose of this regulation is to keep track of assignments. Also commonly referred to as “flipping”, an assignment is the transfer of the right to purchase the condo or other strata lot before the building is completed and registered with the land title office.
The information reported by developers is kept confidential but shared with other agencies, including the Office of the Superintendent of Real Estate and the Canada Revenue Agency.
The regulations are designed to:
- Ensure that people who assign presale units are paying the applicable income taxes
- Create greater transparency in the presale assignment process
The information collected will be used by three government agencies:
- Canada Revenue Agency to trace transactions back to the assignor’s income tax return to ensure applicable taxes are paid
- BC Government to ensure that buyers are accurately reporting the final purchase price of a condo unit, including all assignment amounts, and are paying the appropriate property transfer tax
- BC government to inform future housing and tax policy
What Condo and Strata Lot Developers Need to Do
As of January 1, 2019, you need to:
- Collect information about assignments of purchase agreements, including key terms of each assignment agreement and the name and social insurance number or business information of the parties to the assignment.
- Include terms and a notice in their purchase agreements and disclosure statements to inform purchasers of the new collection and reporting requirements
To see the complete list, visit the Information Collection under the Condo and Strata Assignment Integrity Register (CSAIR) for details on the information required for each type of transaction.
The Land Title and Survey Authority of British Columbia (LTSA) manages the CSAIR, so developers must have a myLTSA Enterprise account to access the register and report. The Office of the Superintendent of Real Estate is responsible for enforcement of information collection and reporting requirements. Reporting occurs quarterly with the first assignment reporting period ending March 31, 2019, and the report due April 30, 2019.