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I don’t think anyone would argue that there are some inefficiencies in government spending, however at the end of the day there’s a simple theory of “money in – money out.” The money to pay for our schools, hospitals and roads (to name a few) has to come from somewhere and most of it comes from property taxes. Even though we pay them every year, many people are unaware of how the property tax system actually works. I hear a lot of complaints and grumbling about it so I thought I would try to explain it. Not that I’m not an expert on the subject but it is part of the pre-licensing course that I teach “soon to be realtors” every week so I know a bit about the basics as follows:
The value of your property is determined by the BC Assessment Authority. Their job is to determine the value of your property as of July 1st of the previous year. If the value has risen in the past year it will appear on the Assessment Notice that you receive in January. It does not necessarily mean you will pay more taxes. How much you pay depends on the budgets that are submitted by the various authorities such as schools and hospitals etc. (see step two)
The BC Assessment Authority is not a villain trying to steal your money – as I heard one disgruntled taxpayer say on the news one day. They (BC Assessment) are paid to do a job, to determine the value of your property as of a certain date. That’s it! They have nothing to do with how much you end up paying. Read on to find out how that part works.
The various authorities such as schools, hospitals, regional district’s etc. submit their annual budget (how much will it cost to pay their employees and all expenses for the year). The total value of all properties, determined by the BC Assessment Authority above, are divided into these budgets and that’s how we get the “tax rates”. This tax rate, sometimes called the mill rate, is then multiplied by the value of your individual property and that equals your portion of the pie that you need to pay (gross taxes payable). From this amount you can deduct whatever grant or tax relief that you qualify for which equals “net taxes” payable. You will receive your Tax Notice in the Spring each year and taxes are due July 1st .
Nanaimo has miles and miles of roads and underground services to pay for and we are a fairly new city (compared to New Westminster as an example) so our tax rate may be higher than other cities which are much older and may have paid for the main services years ago. Nanaimo homeowners will pay approximately 1% of the value of their property so if your property is assessed at $500,000 you your gross taxes payable (before the homeowner grant) may be around $5000.
Note: You have the right to appeal your Assessment Notice (before the end of January) if you think it is too high but you may not appeal your Tax Notice.
I think it’s important to remember how fortunate we are to have a system that pays for schools for our kids, hospitals for the sick, proper roads and sewer systems etc and be grateful that we live in this beautiful place we call home. I hope this helps!
Barbara McNicholls, RI (BC), with her 25 years of experience, has helped hundreds of people pass the exam on the first attempt. Learn how you can benefit from the weekly tutorials.
Almost 700 people packed into the Hyatt Regency conference room in Downtown Vancouver last week to hear what Canadian Real Estate coaching icon Richard Robbins had to say about the secrets to success in Real Estate Sales. Unlike other conferences Richard Robbins has done in the past, this was not a one man show. Over a dozen powerhouse, top producing agents stepped on stage to share their secrets with the audience. I took notes for four days straight and walked away with many great ideas for future success. I’ve since looked over my notes, and now want to share with you my top 5 takeaways and teachings from the week.
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Justus has been with RE/MAX of Nanaimo since January 2005. Justus was born and raised on Vancouver Island, so he and his lovely wife Kelly, decided in 2002 to raise their family on the Island and along with their daughter SaraLynn, are happily living in beautiful Nanaimo.
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