[Hank]

It's a basic principle of tax law that a person can arrange their affairs in such a way as to pay as little tax as possible. As for not having the property in the "owner's" name, you'd be hard pressed to find a business owner, accountant, lawyer or other professional or anyone who might be sued for some reason related to their business who has a property registered in their own name.

It's more than that, though. They don't just have the property owned by the corporation; if they did, the corporation itself would have to pay tax (capital gains and land transfer) when the property was sold. Instead, they have title registered in the name of the corporation, but beneficial ownership in the name of the person (or their spouse, more likely). This way, when the property is sold, beneficial ownership transfers to the new owner but title stays registered in the name of the corporation, so no land-transfer tax is paid, and the person (or their spouse) claims their principal residence exemption to avoid capital gains tax.

You can do the same thing in Ontario with respect to the capital gains tax, but you can't avoid land-transfer tax with the same trick. The government changed the land-transfer tax act decades ago to catch beneficial transfers too.

 

[AndreaPalladio]

But it's legal in BC (and the prairie provinces too, unless its changed). This is actually a very common land ownership structure.

 

[mig174]

Worse, actually. I'm a banker / wealth manager. Real Estate agents' ethical standards was too high a bar.

I'm confident that you are an honorable person.

The homeless population, anywhere, and particularly the hardcore homeless, are a terrible, intractable problem. But it's not connected in any way, shape, or form to the cost of single detached homes in West Vancouver.

Now, this is an interesting thought. Is it true? Is there even anecdotal evidence of, say, HSBC having trouble getting employees to take promotions to Head Office in Vancouver as the housing is too hot and they'd rather stay in Saskatoon or Toronto?

Both of my statements have support, and I appreciate your questions:
As Vancouver home prices surge out of reach, businesses worry how to retain staff
See 'Locating Risk of Homeslessness on the Housing Continuum' part of this paper

I don't actually expect you to read any of this, or even agree with it, given your opinion that homelessness is an "intractable" problem. It is regrettable that your imagination is so lacking - and let's not overburden this discussion with concepts like 'empathy' or 'compassion', for your sake.

Well, I sold my house and will rent when we get back to Toronto. I'd suggest that those 'hardworking Canadian families' do the same, or do a deal with the in-laws. Are you saying they'll reject the inheritance once their baby-boomer parents die?

Yeah... let's not overburden ourselves.

All Canadians, even if they can't afford to own a SDH in Vancouver, benefit from an injection of capital from outside the Canadian economy. Full stop.

Do they really benefit from someone buying a home for millions outright, (misleadingly) declaring a poverty wage so they don't have to pay taxes, yet still benefiting from the social services that all Canadians pay into? At the same time raising property values and cost of living that makes housing less affordable and businesses less competitive?

Anyone has the ability to invest or spend their income. I would advocate investing in something other than West Vancouver SDH as that asset is overpriced, IMHO. To say that someone 'deserves' to own a house anywhere because their parents did is kind of ridiculous, isn't it? I don't deserve a horse just because my dad was a rancher.

I like your horse example. Goes particularly well with the straw you seem to have in abundance.

I'm sorry, but I think that your reaction to this story and thread speak more about you than the actual 'story'.

lol

 

[Riverdale Rink Rat]

I'm confident that you are an honorable person.

Given the rest of your post, you probably should have used the 'sarcasm font' for that lead.

Both of my statements have support, and I appreciate your questions:
As Vancouver home prices surge out of reach, businesses worry how to retain staff
See 'Locating Risk of Homeslessness on the Housing Continuum' part of this paper

I don't actually expect you to read any of this, or even agree with it, given your opinion that homelessness is an "intractable" problem. It is regrettable that your imagination is so lacking - and let's not overburden this discussion with concepts like 'empathy' or 'compassion', for your sake.

I live in Barbados. I am confronted with homelessness and inadequate housing every day, and I am both empathetic and constructive in dealing with it when I can. My imagination, though, does not run to buying million dollar homes and giving them to Eastside addicts. I don't think that's going to help hardcore homeless -- they need a lot more help to transition, and the problem is very, very difficult -- IMO, I believe it is intractable -- as it involves people who are too far along into self-harm to be helped, at least in some cases. If you figure out how to wave a magic wand and have that work, I'll contribute to the SFH million-dollar Vancouver home purchase. It doesn't work that way, as you well know. Heck, you can read Malcolm Gladwell on that one, much less SFU Geography studies from 2006 published by York U's School of Social Work.

Yeah... let's not overburden ourselves.

Interestingly, your other link to the NatPost article had -- buried wwwaaayyy down at the end -- a couple of numbers that were, gasp(!), monthly rentals. And they were... reasonable, at least to these Toronto eyes. So, maybe, the idea of counselling that transfer from Regina to, y'know, sell their house in SK and rent in BC is... not unreasonable? As I said, I'll be renting when I get back to Toronto. If I was going to Vancouver, I'd do the same. The angst about having to own your primary residence or being 'priced out of the market' would be completely foreign to Germans, for example. Why should we Canadians need to be so freaked out about it? Why do we need to 'burden ourselves' with this goal?

Do they really benefit from someone buying a home for millions outright, (misleadingly) declaring a poverty wage so they don't have to pay taxes, yet still benefiting from the social services that all Canadians pay into? At the same time raising property values and cost of living that makes housing less affordable and businesses less competitive?

Yes, they do. Because that 'not paying taxes' student for whom the house was purchased is paying $26k for her science degree at UBC (instead of $5k) as an international student, and will be paying for private health insurance. The house is paying its property taxes. So... she's paying for her education, her health, and her sewer system. She is not Canadian, and she's not paying for our military or foreign affairs or what have you. Seems... about right?

I like your horse example. Goes particularly well with the straw you seem to have in abundance.

I was arguing that the purchase of pricey homes in Vancouver by international money was a net benefit to Canada, as the article was about the fact that it was a scandal, to which I disagreed. You changed the argument to one about homelessness, and possibly 'hidden homelessness of recent immigrants' because you disagreed with my assertion that the high price of SDH in Vancouver does not affect homelessness. And YOU accuse ME of a strawman argument? Hahahaha...

lol

And I'll just re-quote: I'm sorry, but I think that your reaction to this story and thread speak more about you than the actual 'story'. LOL right back atcha...

 

[Migos]

B.C. man pleads guilty to charges in connection to passport scheme that saw hundreds enter Canada illegally

http://news.nationalpost.com/news/c...heme-that-saw-hundreds-enter-canada-illegally

 

[Davidackerman]

Not exactly on taxes.. but WSJ story discusses Chinese moving money outside the country
http://www.wsj.com/articles/in-chinas-alleyways-underground-banks-move-money-1445911877

 

[wild goose chase]

Why is this trend so much more noticeable in Canada than the US (or does it just seem that way)? There are way more large cities in the US, but one notices Vancouver and Toronto as the hotspot for this kind of investment.

 

[Migos]

Easier to escape immigration laws, tax laws, money laundering laws, etc. in Canada than the U.S.

 

[Davidackerman]

USA is a leader in prosecuting white collar crime. Canada's has a terrible record

 

[wild goose chase]

USA is a leader in prosecuting white collar crime. Canada's has a terrible record

I didn't realize this was the case. Sometimes you hear about how the US should be doing more to crack down on market manipulation (eg. some people talk about how Iceland was more willing to go out of its way to jail corrupt bankers).

For some reason, I got the impression that Canadian society in some regards has its policies less swayed or "bought" by the extremely wealthy (eg. look at campaign contribution laws for elections, for instance) but maybe it's not so much in the realm of real estate.

 

[Shiny]

There also Chinese like me who had little space to buy bigger place, and could not believe how much tax we have to pay, and how poorly the new condo unit condition (ICE Condo II) could be.

 

[algotr8der]

These Chinese would fail a *residency* test. Having a child or spouse living in Canada makes you a Canadian resident for tax purposes. As such, anyone who does not file an income tax return with the CRA and fails to show *ALL* income is breaking the law.

 

[Migos]

‘Suspicious transactions’ reported by B.C. banks tied mostly to China
http://www.theglobeandmail.com/news...c-banks-tied-mostly-to-china/article27640202/

Vancouver-area banks reported suspicious transactions involving Mainland Chinese clients 17 times more often than those tied to citizens of any other outside country in recent years.

A Globe investigation this fall showed how local banks helped wealthy East Asian investors circumvent China’s banking laws to bring capital into British Columbia. Chinese citizens cannot legally transfer more than $50,000 (U.S.) a year out of China without government permission.

The Globe investigation found many wealthy investors get around that by having family and friends send millions of dollars in wire transactions to banks in Metro Vancouver. Real estate agents who specialize in luxury housing have told The Globe that many of their clients get the money they use to buy homes in Canada through these transactions.

Even when Canadian police are made aware of possible money laundering activity, they do not have the funding to undertake many high-level cases, according to financial crimes specialist and former RCMP investigator Kim Marsh.

“There’s no accountability, there’s no deterrence,” said Mr. Marsh, who is based in Vancouver and has worked with Chinese institutions to recover laundered assets. “If you’re talking about Chinese nationals buying property here, you can’t tie it to a crime because you don’t know what happened back in China and how they got the money,” he said.

 

[Davidackerman]

This is more about USA.. but check out this story on WSJ
Where rich Chinese are stashing their cash: America’s hotels and strip malls

http://on.wsj.com/1lNdbmO

 

[James]

One major concern of mine is the sustainability of these mega investments. These investments increase in value so long as there are other investors in the future who are willing to pay a premium for them. How long can this be sustained before the pool of future investors either diminishes or decide that there are better investments elsewhere?