Have both agreements reviewed
Ask your lawyer to read the proposed assignment with the original contract and amendments.
- Identify required approvals and fees.
- Check continuing obligations.
More on have both agreements reviewed
Do not assume an assignment is available or releases every responsibility.
Map the money and approval dates
Bring the combined transaction details to your advisors.
- List funds due under each agreement.
- Confirm financing with your lender and tax questions with your tax advisor.
More on map the money and approval dates
Record required approvals and deadlines before committing.
The basics
What a presale assignment is
When you buy a presale, you sign a contract for a home that will be finished later. An assignment transfers that contract to someone else before completion. The person taking over is the assignee. You, the original buyer, are the assignor.
The assignee pays you an agreed amount, which reflects the deposits you paid and any gain or loss. Then they complete the purchase with the developer when the building is ready.
Why it matters
Why assignments need careful review
BC’s real estate regulator says a presale contract may let the developer charge an assignment fee, cap the number of assignments, or forbid them. A developer can refuse consent even when you have found a willing buyer.
Responsibility can stay with you, too. BC’s real estate regulator explains that if the assignee cannot complete, the original buyer typically remains liable to the developer. Taxes may also apply to any profit.
How it works
Steps to take before you assign
Read your contract’s assignment clause
Check whether you need the developer’s consent, whether a fee applies, and any limits on marketing. Ask your lawyer or notary to explain what you find.
Confirm developer consent early
Ask the developer how it handles requests and how long consent takes. Do not promise a buyer a timeline before you know.
Work out the money
List your deposits paid, the assignment price, the developer’s fee and agent commission. Remember that GST may apply depending on the original contract.
Check your holding period
Note the date you entered the contract. That date drives both federal and BC flipping rules. A short hold can mean much higher tax.
Get tax advice before signing
Talk with a tax professional about income tax, the BC home flipping tax and GST. Bring both the original contract and the proposed assignment.
Confirm what happens if the assignee fails
Ask your lawyer whether you stay liable if the new buyer cannot complete. Plan for that risk before accepting.
Avoid these
Assignment mistakes
Assuming you can always assign
Many contracts restrict assignment. If the developer says no and you cannot complete, you risk losing your deposit and facing a claim for losses.
Forgetting the buyer’s costs
BC’s real estate regulator notes the assignee may owe property transfer tax on the original price plus the assignment amount, and may owe GST. Those costs affect what a buyer will pay you.
Thinking of profit as a capital gain
CRA treats profit on a right to acquire held under 365 consecutive days as business income, unless a life event exception applies. Losses on such flips are deemed nil.
Ignoring the BC flipping tax
The BC home flipping tax applies to presale contracts disposed of within 730 days. A presale assignment cannot use the primary residence deduction.
Example
How the BC home flipping tax rate works on an assignment
Based on the Province’s published example and formula. Numbers are illustrations, not your tax bill.
| Price paid to developer | $750,000 |
|---|---|
| Assignment price | $800,000 |
| Taxable income in the Province’s example | $800,000 − $750,000 = $50,000 |
| Held under 366 days | Rate 20%: $50,000 × 20% = $10,000 |
| If held 500 days instead | 20% × (1 − (500 − 365) ÷ 365) = 20% × 0.630137 = 12.603% (rounded to the nearest thousandth) |
| Tax at 500 days | $50,000 × 12.603% = $6,301.50 |
| Held 730 days or more | BC home flipping tax no longer applies |
Federal income tax is separate. A tax professional should confirm your actual figures and any exemption. For GST, see GST on new homes.
Questions to ask
Questions to ask before an assignment
Your lawyer or notary
- Does my contract allow assignment, and on what terms?
- Will I remain liable if the assignee does not complete?
- How will deposits be handled between me and the assignee?
Your tax professional
- Is my profit business income or a capital gain?
- Does the BC home flipping tax apply, and do I qualify for an exemption?
- Is GST payable on this assignment?
The developer
- Do you consent to assignments, and what is the fee?
- How long does your approval take?
- Are there limits on how an assignment can be marketed?
FAQ
Common questions
Are presale assignments legal in BC?
Yes. BC’s real estate regulator says assignments are permitted, but the contract and the law set conditions. Many presale contracts need the developer’s consent, and some forbid assignment entirely.
Do I pay tax on a presale assignment profit?
Usually yes. CRA says profit from an assignment held under 365 consecutive days is business income, unless a life event exception applies. The BC home flipping tax may also apply. Get advice from a tax professional.
Does the seven-day cancellation right apply to an assignment buyer?
No. BC’s real estate regulator says the seven-day right to cancel a presale contract does not apply to the new buyer who takes over through an assignment.
Do I need to file a BC home flipping tax return?
The Province says you must file within 90 days of the sale if you owe the tax or your exemption only applies after filing. The return is separate from your income tax return.
What happens if the developer refuses my assignment?
You may have to complete the purchase yourself. If you cannot, BC’s real estate regulator warns you could lose your deposit and be liable for the developer’s losses. Speak to a lawyer right away.
A practical example
Read the two agreements together
Ask your lawyer to explain how the proposed assignment interacts with the original purchase contract and any amendments.
- Create a timeline of funds, approvals and continuing obligations.
- Bring that picture to your lender and tax advisor.
A clear combined view matters more than an advertised assignment price in isolation.
A detail to keep in mind
Do not assume an assignment releases every obligation or will be available if your plans change.
Official information
Start with these resources, then confirm the details for your property and circumstances.
BC Financial Services Authority: assignmentsBC Financial Services Authority: Consumer guide to pre-sale real estate purchasesProvince of BC: BC home flipping tax and pre-sale contractsCRA: Residential property flipping ruleReference review: October 6, 2026