Tax and Land Information Website: Real Property Transfer Tax

Tax and Land Information Website

Real Property Transfer Tax

The Real Property Transfer Tax Act came into force on May 16, 2005.

The Real Property Transfer Tax Act states that anyone who registers a deed in Prince Edward Island must pay, before the deed is registered, a tax computed at the rate of 1% of the greater of the sale price or the assessed value of the real property.

Low-cost Real Property Exemption:
No tax is payable on the transfer of real property if the purchaser’s affidavit indicates that the greater of either the sale price or the assessed value of the real property does not exceed $30,000.

First-time Home Buyer Exemption:
No tax is payable on the registration of a deed of conveyance if the person is a First-time Home Buyer. A First-time Home Buyer must meet all of the following criteria:

the individual(s) must occupy or use the real property as his or her principal residence, and
the greater of the purchase price or the assessed value of the real property cannot exceed $200,000,
if there is more than one purchaser, all the purchasers of the real property must qualify as first time home buyers, and
must meet the qualifications for and fill out the Declaration - First-time Home Buyers form at the time of registration.

More detailed information on the First-time Home Buyer Exemption can be found under Section 5 of the Real Property Transfer Tax Act; click here:

Inter-family Transfer Exemption:
No tax is payable on the registration of a deed of conveyance if the recipient(s) are all members of the family of the person making the transfer, and the sale price is not in excess of $1.

"Member of the family" means, in relation to a person, the father, mother, spouse, common-law spouse, grandfather, grandmother, son, daughter, brother, sister, grandson, granddaughter, son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, sister-in-law, step-father, step-mother, step-son, step-daughter, step-brother or step-sister of the person.

A Declaration of Inter-family Transfer form must be submitted at the time of registration.

Additional Exemptions:
There are a number of additional situations which are tax exempt, such as:

certain estate transfers,
certain corporate transfers,
certain trust/trustee transfers,
certain mortgage transfers,
transfers of property to the Crown, municipality or to a non-profit organization,
certain non-arms-length transactions such as Deeds of Correction, or
property transfers as a result of a marriage breakdown.

More detailed information on these and other exemptions can be found under Section 4 of the Real Property Transfer Tax Act;
click here:

Please note:
This page is prepared for information purposes only, and should not be considered a substitute for the applicable statutes. Should there be any conflict between the contents of this page and the statutes, the statutes shall prevail.

Publications

Information on the Real Property Transfer Tax - Brochure [PDF 205KB]