Archive for November, 2023

When Do You Need to Hire a Notary?​​​​​​​

A notary public (also known as a notary), is a trained professional who can provide limited legal services to the public.

Notaries have been around for a long time. Babylonian notaries chiseled the oldest written law into stone over 4000 years ago. At that time, a notary was a wise and trusted member of society. The role of a notary was to oversee transactions and guarantee their fairness.

The role has since evolved into a professional service, but its essence is still the same. In today’s times, a notary public still guarantees clients the fairness and legality of transactions.

WHEN DO YOU NEED A NOTARY?

woman signing papers

There are a number of scenarios in which you would benefit from a notary. Our team at David Watts Notary Public can assist with:

1. Real Estate Transactions

If you’re on the cusp of either buying or selling a property, a notary plays a pivotal role. A notary public will ensure that all the documentation is in order, legally binding, and properly executed. This is crucial in preventing any future legal hiccups.

2. Property Transfers

Planning to transfer property ownership to a family member? This is another scenario where notarial services are invaluable. A notary public will be able to help you navigate the complex legal landscape, ensuring that the transfer is done correctly and legally.

3. Mortgage Processes

Entering the world of mortgages can be daunting. A notary can guide you through the process, ensuring that all agreements and contracts are legally sound and that your rights are protected.

4. Estate Planning

When it comes to preparing crucial documents like wills, representation agreements, or powers of attorney, working with a notary is not necessary, but highly recommended to avoid potential disputes. A notary public will make sure that your wishes are clearly articulated and legally enforceable.

5. International Travel with Children

If you or your spouse plan to travel abroad with your kids, especially without the other parent, notarized consent is often required. A notary will be able to provide you with the necessary legal backing for such documents.

6. Signing Affidavits

Affidavits are sworn statements used in various legal settings. A notary ensures that these are signed in accordance with legal standards, lending them the required authenticity and validity.

7. Moving Abroad

If you’re relocating to another country, you’ll likely need various documents notarized. A notary public ensures that your documents are accepted internationally, adhering to the legal standards of your destination country.

Many people think that they should hire a lawyer instead of a notary to do these things. I’ve written about the difference between lawyers and notaries in the past, but here’s what you need to know in a nutshell:

A notary public specializes in non-contentious matters, dealing with documents and transactions where there is no dispute or need for legal representation in court. Our expertise lies in ensuring that your documents are legally sound and your transactions are executed smoothly.

British Columbia notaries are experts in the areas we choose to practice.  

If we act for you as a notary in business agreements or residential real estate transactions, our experience will help us to identify issues and deal with them before they become problems.

The Difference Between Lawyers and Notaries

If we do get to a place where litigation is necessary, we are here to help you find a lawyer who can provide legal advice and assistance. We have a community of trusted legal professionals who are experts in litigation.

WHAT CAN BC NOTARIES DO FOR YOU?

woman with notary seal

BC Notaries have professional standards dictated by the Notaries Act of British Columbia. A notary is also governed by the rules, by-laws, and best practices dictated by The Society of Notaries Public of British Columbia.

That means that at David Watts Notary Public we are a team of certified experts and can help you with all your notary needs.

1. REAL ESTATE TRANSFERS

A notary public can help you complete legal documents for real estate transactions such as Purchases, Sales, Mortgages and Family Transfers. By working with a notary, you are ensuring a smooth and legal transition or purchase of property.

2. PERSONAL PLANNING DOCUMENTS

A notary can help clients prepare for the future with Wills, Powers of Attorney, and Representation Agreements. By having these important legal documents notarized, you will help ensure their legitimacy and ability to be held up in a court of law.

3. NOTARIZATION

A notary public can provide General Notarizations and Certified True Copies of Original Documents as well as Notarize your signature on:

  • Travel Letters

  • Affidavits

  • Statutory Declarations

  • Letters of Invitation

  • Passport Documents

  • Various Applications

4. INTERNATIONAL AUTHENTICATION AND LEGALIZATION SERVICES

A notary can get documents authenticated and legalized for use in Canada and around the world.

DAVID WATTS NOTARY PUBLIC: NOTARY SERVICES COST

Below is a list of our fees and additional information regarding our notary services. If you have any questions regarding our fees, please contact us. 

NOTARIZATION COST

  • Cost for Certified True Copies of documents: $60 ($53.57 + GST & PST)

  • Additional documents or copies: $20 each

MULTIPLE EXHIBITS:

  • For documents with multiple exhibits, we charge $20 per exhibit after the 4th.

INTERNATIONAL OR REAL ESTATE DOCUMENTS:

  • For documents to be used outside of Canada, or involving real estate purchases, sales, or mortgages, please email us for a specific quote.

PLEASE NOTE:

  • Ensure to print and bring the documents.

  • Bring 2 pieces of unexpired identification, with at least one being government-issued with a photograph.

NOTARIZED AND CERTIFIED TRUE COPIES

CERTIFIED TRUE COPIES COST:

  • First copy/document: $60

  • Additional copies: $20 each

PROVIDING COPIES:

  • You can bring the original documents, and we can make the copies here.

  • If you prefer, you can bring your own copies.

PRINTING CHARGES:

  • For more than 10 pages, we charge $1.00 per page.

GET IN TOUCH – DAVID WATTS NOTARY PUBLIC

To find out more information about our notary services, receive a quote, or to book an appointment, please call or email us. Our office is conveniently located at 675 W Hastings St Unit #1412 in downtown Vancouver. We are happy to assist you directly or to provide a referral for someone who can help.

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What Every Home Buyer Must Know About Vancouver’s Empty Homes Tax

If you are buying a house, Vancouver’s Empty Homes Tax, also referred to as the Vacancy Tax, may unexpectedly apply to you.

In 2017, after the Vancouver City Council passed the controversial Tax By-Law, dozens of homeowners and buyers have come to my office asking about whether it applies to them.

The answer is not always clear, which can be particularly unsettling at the time of a real estate transfer. The new home buyer may be unknowingly responsible for paying a $10,000+ tax up to 2 years into the future. Ouch!

In this guide, we explain this tax in simple English so that all homeowners and buyers understand what it is and whether it applies to them.

We also outline a solution that ensures no home buyer is caught with an unexpected tax up to 2 years after they purchased a house.

WHAT IS THE EMPTY HOMES TAX?

The Empty Homes Tax, also known as the Vacancy Tax, applies to residential properties within the City of Vancouver that:

  • Have been vacant for six or more months during a calendar year, or;

  • Has not been rented out for 30 or more consecutive days.

The Vacancy Tax was set up for two reasons:

  1. To make empty or under-utilized properties available for long-term rental, and

  2. To help relieve pressure on Vancouver’s rental housing market, given low rental vacancy rates and high rental costs. 

The bylaw was passed by the city council in December 2016, in a context in which rental prices were soaring and more than 25,000 properties within the city remained empty or under-occupied. 

The tax looks to incentivize rentals, and the net revenues from the Vacancy Tax will be reinvested into affordable housing initiatives in order to continue providing solutions to Vancouver’s housing crisis.

The rate of the Empty Homes Tax is 1% of a property’s assessed taxable value. It is an annual tax that is applied on a yearly basis. This means that for every $1 million dollars of value, the vacancy tax will be $10,000 a year.

WHO DOES THE EMPTY HOMES TAX APPLY TO?

The types of Vancouver properties the empty home tax applies to

Any non-principal residences within the City of Vancouver that are left empty for six months of the year or longer will have to pay the Vacancy Tax.

If your property is located in a municipality that does not fall within the city, such as the University Endowment Lands, Burnaby, or Surrey, the tax will not apply to you.

According to the City of Vancouver, this will only apply to a category of homes known as Class 1 Residential, which includes “single-family residences, multi-family residences, duplexes, apartments, condominiums, nursing homes, seasonal dwellings, manufactured homes, some vacant land, farm buildings, and daycare facilities.”

If your property is within the boundaries of the city of Vancouver but is not solely classified as a Class 1 residential property, the Vacancy Tax will not apply, and you are not required to make an annual property status declaration.

Some exceptions to the tax exist. They include, but are not limited to properties that:

  • Are not a principal residence, but were occupied for at least 180 days of the year because you worked in the city of Vancouver.

  • The owner or the tenant was receiving long-term, inpatient, medical, or supportive care.

  • The registered owner was deceased, and a grant of probate or administration of the estate was pending.

  • The title was transferred during the year.

  • Were undergoing redevelopment or major renovations where permits:
    had been issued and were being carried out diligently and without delay, or
    were under review for redevelopment of vacant land or the conservation of heritage property.

  • Are under a court order, court proceedings, or an order of a governmental authority prohibiting occupancy.

The types of buildings being assessed

HOW WILL THE TAX BE IMPLEMENTED?

Every year, Vancouver homeowners will need to make an annual property status declaration. This will include the valuation of the property and state whether or not the property was vacant for six months or more during the previous fiscal year.

The declaration will then be used to determine whether or not the property will be taxed.

All declarations for the 2017 fiscal year must be made between December 1, 2017, and February 2, 2018. Failure to do so will lead to the imposition of the tax, as well as a fine that may reach up to $10,000 per day of non-compliance. 

False reports can also lead to a $10,000 fine for homeowners.

According to a report published by Global News earlier this year, a City of Vancouver spokesperson said that “property status declarations will be subject to a rigorous audit process, in line with best practices for provincial and federal tax programs.”

This means that homeowners should definitely comply with the law and be truthful in their declarations.

Cost of empty homes tax

WILL UNPAID TAXES BE TRANSFERRED TO A NEW BUYER? 

Buyers may have to pay taxes owed on a property after they purchase it.

According to the bylaw, if you purchase or inherit a property that has an unpaid Empty Homes Tax, you will not have to pay the one percent tax for that fiscal year.  

If it is found that it should have applied to previous years, that tax will be added to the property tax account associated with that property and “run with the land.”

However, you’ll still have to present an annual property status declaration.

Will the empty home tax be transferred

THE SOLUTION WE’VE FOUND TO THE POTENTIAL TAX PROBLEM

An audit for the previous year could take place 1-2 years after your home purchase is completed.  

Even if you know that the seller lived there, it may be impossible to find them to sign an affidavit and provide the evidence required. This could be problematic.

We have seen several times where relations between buyer and seller are strained during the property transaction and negotiations.  How do you know they will cooperate with an audit?

As BC Notaries, we are asked to provide our final report that the buyer owns the property free and clear of previous incumbents.  This is a new challenge in how we can now do that under the cloud of vacancy tax as the audit time is in the future and the tax liability stays with the homeowner.

The penalty goes to the individual (the previous owner), but the tax, if unpaid, goes to the land.

Neither the City of Vancouver nor the real estate (salesperson and legal) community has done a great job at finding a convention on how we can deal with this. With every real estate transaction, there is a potential that people are arguing about the Vacancy Tax.  

This is an evolving area without a set of generally accepted legal industry practices. To protect buyers, we have a few new steps for City of Vancouver purchasers.

how home buyers can protect themselves

1. CONFIRM TAX STATUS

Ensure that declarations are made and taxes are paid or held back until the declaration is made.

2. PROTECT THE BUYER AND LENDER FROM A FUTURE TAX

Where the contract is silent on who is going to deal with the issue of Empty Homes Tax, we need to find something that has certainty.

We have worked with the title insurance companies to confirm protection, and most title insurance policies will protect buyers and lenders from the result of an unfavorable audit for the previous year’s declarations.

The cost of title insurance depends on the price of the property. Here is a Policy Calculator for Stewart Title. The cost and coverage between title insurance companies are about the same.  

While title insurance is an increased cost, we can find something that delivers certainty as well as providing protection in several other areas as well.  We urge all buyers to now purchase “owner policy” title insurance.

Many lenders already insist on getting title insurance to cover the mortgage.

The Vacancy Tax isn’t mentioned in the contracts of purchase and we receive.  We can’t have variables.  We urge our purchasers to follow our advice and purchase owner’s policy title insurance.

Purchasers do have a choice, and our clients can refuse to buy title insurance. In such cases, we will provide a waiver, and we can confirm the risk lies solely with the purchaser. They agree that we accept no liability for unpaid taxes or risks that would have been covered by title insurance.

refuse title insurance

KEY TAKEAWAYS

Overview of the Empty Homes Tax: Introduced in Vancouver in 2017, the Empty Homes Tax, also known as the Vacancy Tax, targets residential properties within Vancouver that are vacant for six or more months during a calendar year or not rented out for 30 or more consecutive days.

Purpose of the Tax: The tax aims to alleviate pressure on Vancouver’s rental market by incentivizing the rental of empty or underutilized properties. The revenue from the tax is directed towards affordable housing initiatives in Vancouver.

Tax Rate: The tax is set at 1% of the property’s assessed taxable value, meaning a $10,000 tax per year for every $1 million in property value.

Applicability of the Tax: The tax applies to non-principal residences in the City of Vancouver left empty for over six months per year. 

Implementation and Compliance: Homeowners must annually declare their property status, indicating whether the property was vacant for over six months. Failing to declare or submitting false reports can lead to significant fines.

Impact on New Buyers: Unpaid taxes may transfer to new buyers. To mitigate the risk of the Vacancy Tax, buyers in Vancouver should confirm the tax status, ensure compliance, and consider purchasing an “owner policy” title insurance for protection against potential future tax liabilities.

HAVE ANY QUESTIONS?

If you still have questions regarding the Empty Homes Tax and for more information about buying real estate in the City of Vancouver, please call or email us.  We are happy to assist you directly or to provide a referral to a notary or lawyer in your area.

David Watts, BC Notary
Clinton Lee, BC Notary
David Watts Notary Corporation
Phone: 604 685 7786

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