Edmonton Property Taxes: Who Pays?
You have just found the perfect home in Edmonton. After months and months of searching the dream house is finally yours. The only thing left to do is figure out what fees and taxes have to be paid before you get the keys. These little fees are all part and parcel of what is known as closing costs.
Closing costs on a home can easily reach upwards of a few thousand dollars, which means you’ll need to have this money on hand when the papers are signed. One of these costs is property taxes. Since property taxes are paid by the year, often the burden to pay will fall to both the current and future homeowner.
Edmonton property taxes are due on the last day of June each year. These taxes provide funding for many different civil services such as fire protection, law enforcement, public transportation and parks. These taxes benefit home and condo owners in the tax jurisdiction as well as renters.
Who Is Responsible For Property Taxes
Ask any Edmonton real estate lawyer who’s responsibility it is to pay property taxes—homeowner or home buyer—and they will tell you, ‘it depends’ because it does.
Of course the neither the homeowner or the buyer is expected to pay property taxes for the entire year if they don’t own the property the entire time. Most often property taxes to the city of Edmonton are pro-rated, which just means that each party pays taxes for the amount of time in which they owned the home.
Keep in mind however, that as the buyer your move-in date begins your tax liability period. So if you purchase a home but don’t move in for 6 months, you are responsible for property taxes for that period.
If the current homeowner has already paid the taxes in full, which is possible since the notices are sent out in January, you will be expected to reimburse them for the period from your move-in date forward. Your Edmonton real estate lawyer will advise you to bring the pro-rated property tax amount with you to the signing.
Your lender (bank) may require you to pay a few months of property taxes in advance as a good faith effort to prove you will not default on your taxes. So you may have to not only reimburse the current homeowner for property taxes paid in advance, but you might also be required to pay a few additional months in advance.
It is important that you know exactly how much you need at the time of the signing, so request a copy of the tax assessment notice from the city of Edmonton or from the homeowner. This will ensure you’re paying what you owe and give you an idea about how much you need to pay advance property taxes to appease your lender.
Keep in mind that property tax fees are in addition to a host of other fees due at the time of closing, including legal fees, down payments, insurance and land title fees.
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