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Remember learning about the Boston Tea party in history class and the rallying cry, “no taxation without representation”? Well, if you find yourself being billed for land tax on a house you’ve sold, that could be a case of “taxation without accurate representation”. Simply put, you may still be represented as the owner on the Land Tax records, notwithstanding the fact you have parted with ownership of the property.
That begs the question – how does the Land Tax office know to change their records so as to bill the new owner? Well, years ago the practice used to be that the lawyer handling a property transfer would file a transfer notice with the Registrar General’s office (now the Land Title Registrar’s office) and, at the same time, send a copy to the Land Tax office. The Land Tax office would change their records on the strength of the notice received from the lawyer and the new owner would then be billed for the land tax going forward.
Then the Tax Commissioner noticed that sometimes transfer notices were being filed in circumstances where stamp duty had not been paid on the transfer deed. That’s a serious concern when the sums at issue could be in the region of tens of thousands of dollars.
So the Tax Commissioner (whose office is responsible for collecting stamp duty as well as land tax) teamed up with the Registrar General (where the land transfer notices used to be recorded) to help monitor the payment of stamp duty. An edict was passed saying that no transfer notice could be filed unless a certified copy of the duly stamped transfer deed accompanied it (in order to prove that the stamp duty had been paid).
If you recently disposed of your house and are still receiving the land tax bill, it might be a sign that something may be amiss. I say “might be” because there are perfectly innocent situations where this might occur.
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Why am I still getting billed for land tax after selling my house!?