Foreign Investors evading taxes through Vancouver real estate.
I was born and raised in vancouver, my family is all from here. We’ve lived and breathed Vancouver for I don’t know how long. My parents are honest, hard working people. My dad is a pilot and my mom is a realtor and just like most people they pay their fair share of taxes whether they agree with it or not.
What you might not know is that Realtors are a profession which is heavily watched by the Canadian Government. My mom is probably the most honest person I know and I’m grateful for that because I believe she passed that trait down to me.
In a system based primarily on honesty, they come after the most honest person. The governement is always coming after her for more taxes. Someone who has lived here all her life and works hard for everything she has. What they’re saying is “We don’t believe you. We don’t trust you. You owe us more.”
Even more frustrating if you’ve seen the news lately, but you can’t miss it. “Foreign investors avoid taxes through Canadian Real Estate”
Here’s an excerpt from the Globe & Mail “ Beijing-based private equity manager who bought a $2.3-million home in the hot Vancouver real estate market said he did that while earning just $19,000 a year. He also wired nearly $2-million to his family in Canada during the same period.
Jing Sun is among several foreign investors who bought property in Canada in recent years, but kept the extent of their wealth out of view of the tax authorities and the courts,”
Now the globe and mail goes on to say “An in-depth look at public data – including land titles, tax reporting and court records – revealed a distinct pattern, suggesting the typical wealthy foreign family buying Vancouver real estate pays little or no income or capital gains tax.”
So while many of us hard working Canadian citizens pay our fair share of taxes, the foreign investor comes in, outbids us on the home we are trying to buy then claims they’re poor and doesn’t pay any taxes.
In the Vancouver area of Dunbar, which us Realtors would say is a top neighbourhood for Chinese clients, one in four of what Stats Canada calls “couple families” declared income of less than $35,000 in 2013. That puts them in the lowest tax bracket.
By the way the Average home in Dunbar is roughly 2.2 million.
But yet 1 in 4 families are declaring income of less than 35,000….
The home goes under the wife or daughter or sons name, they’re either unemployed or going to school, the husband wires in money to support them.
Then we pay all the taxes for roads and hospitals, education and the likes…While they pay nothing.
It appears the RICH GET RICHER.
Ok so here’s another example there was a case against a Hong Kong businessman David Ho. The judge determined he had a net worth of $15-million to $20-million when his girlfriend, Jade Chen, came to Canada and started managing assets for him. The court concluded Mr. Ho’s annual income – from one bank account alone – was 100 times higher than the total income he reported to the CRA.
The court concluded that Mr. Ho bought several properties in the Vancouver area. He put one in Ms. Chen’s name, another in his son’s, and two – worth $5-million under a corporation.
All while claiming his annual income which was $1,254 in 2009.
So you’re telling me he bought 4 properties in Vancouver, all while making 1254$ per year?
The article goes on to say that he put several properties – in the name of a corporation that had no purpose but to hold his assets in trust.
When a corporation sells property, the shareholders can simply sell the company’s shares to the new buyer, so the home stays in the company name. In that scenario, no one pays the B.C. provincial property transfer tax – $40,000 on a $2-million sale. To make matters worse Mr. Ho became a Canadian citizen years ago and signed up for B.C. health coverage. Until recently, however, he claimed on his taxes that he was a non-resident. So now he gets free health care paid by me and you. free dental work and even welfare checks and GST refunds because he’s “poor?”
Let that sink in. Your taxes, your hard earned money is being given as a welfare check to the foreigner with the multi million dollar house that you can’t afford. Did I need to remind you he owns 4 houses already.
So while you struggle to buy a house.. One single house. This dude already has 4.
This guys laughing all the way to the bank with his welfare cheque that you paid for!
Now the reason I tell you this is not to rub it in your face. I’m just like you, working hard to afford housing and paying my fair share of taxes.
The reason is I want to get a message across.
Vancouver immigration lawyer Samuel Hyman said neither the federal nor B.C. governments are cracking down on people who pay sky-high prices to buy Canadian houses but don’t pay taxes on global income.
That goes for both overseas property owners who are avoiding taxes through a legal loophole — by becoming non-residents for income tax purposes, for example — and for those residents acting outside the law by not reporting global income, Hyman said.
How is this allowed to go on?
The system is broken! It’s been broken for a long time. But you can’t just point the finger at the Foreign Investor, it’s the Government who needs strengthen these laws, to close the loopholes that Foreigners are taking advantage of. It’s time to have a voice, to be heard. To voice your opinion, and to push for change.
My hope is that this has resonated with you. IF it has, like this video, share this message. Spread the word and hopefully we can make change together.
It’s time we start holding people accountable.