BC Home Flipping Tax Explained (2026)

Short answer: Since January 1, 2025, BC’s home flipping tax applies to profit from selling residential property in BC, including presale contracts, that you’ve owned for less than 730 days. The rate is 20% of the net taxable income if you sell within 365 days, then it declines to zero by day 730. It’s separate from income tax, has its own return due within 90 days of the sale, and there are exemptions for life events and a deduction of up to $20,000 for some principal residences. Talk to your accountant before you list.

Most of my Vernon sellers have owned their homes for years, so this tax never comes up. But it catches people who didn’t expect to sell so soon: a job change, a relationship ending, a move that didn’t work out, or a buyer who bought a presale and wants to assign it. Here’s what the rules say as of 2026, in plain English. This is general information, not tax advice.

What is the BC home flipping tax?

Its official name is the Residential Property (Short-Term Holding) Profit Tax. According to the Province of BC, it took effect on January 1, 2025 and applies to income from selling a residential property in BC, or a right to buy one (such as a presale contract), that you’ve owned for less than 730 days.

It applies to individuals, corporations, partnerships and trusts, and it doesn’t matter where the seller lives. BC residents and people outside BC or Canada are both covered.

How much is the flipping tax?

The rate depends on how many days you owned the property:

365 days or less: 20% of your net taxable income.
366 to 729 days: a declining rate, calculated as 20% x [1 – (days held – 365) / 365].
730 days or more: no flipping tax.

So at roughly a year and a half of ownership, the rate is about half of 20%. The province’s calculation page walks through an example: a home held 398 days with $90,000 of taxable income and a $20,000 primary residence deduction leaves $70,000, taxed at 18.192%, for $12,734.40 of flipping tax.

Thinking of selling in the next year? Find out what your home is worth with a free home valuation based on recent sales near you, or book a 10-minute chat. Prefer to text? 778-363-0542.

How is the taxable income calculated?

Broadly, it’s what you received on the sale minus your cost to acquire the property and your cost to improve it. Eligible costs can include things like the property transfer tax you paid when you bought and certain costs of the sale. If the result is negative, it’s treated as zero. A loss on one property can’t be used to reduce the tax on another.

Your accountant should run these numbers, because the details of what counts as an acquisition or improvement cost matter.

Is there a deduction if it was my home?

Yes. If the property was your primary residence, you may be able to reduce your taxable income by up to $20,000. The province describes this as applying where you lived in the home as your primary residence for at least 365 consecutive days. On a modest gain, that deduction can eliminate the tax entirely. On a larger gain, it reduces it.

What are the life circumstance exemptions?

The province lists life circumstance exemptions that can apply even if you sell within 730 days. For individuals, they include:

Death, or a serious illness or disability (yours or a related person’s).
An eligible relocation for work or full-time post-secondary study. For a primary residence, your current home must be at least 40 km farther from the new job or school than your new home.
A change in household membership, such as a related person moving in, you moving in with relatives, or having or expecting a child.
Breakdown of a marriage or common-law relationship, after living separate and apart for at least 90 days before the sale.
Involuntary termination of employment (for employees, not the self-employed).
A threat to your personal safety or that of a related person living with you.

Other exemptions include bankruptcy and insolvency, a home destroyed or made uninhabitable by fire, flood or another disaster, expropriation, foreclosure, property received from an estate, and a presale whose completion is delayed by more than 365 days. There are also separate exemptions for builders and renovation activity, and for some transfers between related people. Each has conditions, so read the details and get advice.

Do I have to file even if I’m exempt?

Often, yes. You must file a BC home flipping tax return within 90 days of the sale if the tax applies, or if you’re claiming an exemption that requires a return. This is completely separate from your annual income tax return. Missing it can mean penalties and interest, so put the date in your calendar the day you accept an offer.

How does it fit with the federal flipping rule?

They’re two different taxes. Federally, since January 1, 2023, profit on a home sold within 365 days is generally treated as fully taxable business income, and the principal residence exemption isn’t available, unless a life-event exception applies. BC’s tax sits on top of that and runs for a longer window, up to 730 days. I explain the federal side and the principal residence exemption in capital gains and the principal residence exemption.

What about presales and assignments?

Presale contracts count. Buying a presale and assigning the contract before completion can be taxable under the flipping tax, and the province has a dedicated presale contracts page that explains how days of ownership are counted. If you’re considering an assignment, talk to your lawyer and accountant before signing anything.

What should I do if I might sell within two years?

Count your days. Ownership is generally measured from when you acquired the property to when you sell it, and the exact dates matter.
Check whether a life circumstance exemption or the primary residence deduction applies.
Get your accountant to estimate both the provincial flipping tax and your federal income tax.
Compare that to waiting. Sometimes holding a few more months changes the math a lot; sometimes life doesn’t allow it.
If you do sell, file the BC return within 90 days.

As your REALTOR, my job is to help you understand the timing and market side of that decision, and to make sure you’re talking to the right professionals before you list.

Frequently asked questions

When did the BC home flipping tax start?

January 1, 2025. It applies to sales of residential property in BC, including presale contracts, owned for less than 730 days.

Does the flipping tax apply if I lived in the home?

It can. You may be eligible for a deduction of up to $20,000 if it was your primary residence, and life event exemptions may apply, but living there doesn’t automatically exempt you.

When is the BC flipping tax return due?

Within 90 days of the sale, and it’s separate from your annual income tax return.

Is the rate always 20%?

Only for sales within 365 days. Between 366 and 729 days the rate declines, and at 730 days or more there’s no flipping tax.

If life has you selling sooner than planned, read my guide to selling your home, and see how long it takes to sell a house in Vernon for the timeline side.

More Vernon guides

Questions about buying or selling in Vernon?

I’m Sean Phillips, a REALTOR® with Coldwell Banker Executives Realty in Vernon, BC. I live in Okanagan Landing, and I help buyers and sellers across Vernon, Coldstream, SilverStar and the North Okanagan.

Text or call Sean: 778-363-0542
Call or text Sarah, my 24/7 info line: 604-227-4810

Book a 10-minute chat with Sean

This article is general information as of fall 2026, not legal, tax or financial advice. Rules, fees and conditions change, so confirm details with the appropriate professional or authority before making a decision.

Featured photo by Milivoj Kuhar on Unsplash.

BC’s Home Flipping Tax: What Sellers Need to Know