Crown Lien

[bearowski]

Hi,

Would I be correct with regard that Crown Liens carry with the Properrty TAx owing?

I am unsure regarding privacy on this discussion board, so please excuse the lack of detail ..

Property coming up in TO has a hefty 200k+ tax lien at high interest rate..... It is detailed as a Crown lien.

 I was curious to know if anybody else had come across this and also their interpretation regarding the bearer of this TAx lien.

B

[Rob]

There is no privacy policy on the board regarding that type of information.  But the new member only forum, and bronze level forums are in place to talk about issues that you may not want to share with the general viewing public.

SIDE NOTE:  The Bronze Level forum is only available to someone who has posted or replied 5 times.  The members only forum is available to anyone who has signed up as a member.

Its an interesting question.  I was under the impression that the lien would be removed before it was available as a tax sale property.  Lien holders are notified 3 times prior to the property being listed and once the property is sold they have no recourse.  Because this is a crown lien so this might be a different case.  I would contact the person in charge of the property being sold and ask them.  I would love to hear the answer.

[common]

Everything that I have read indicates that liens credited to the Crown remain with the title.

[candi839]

I agree with Common.  Last year when the City of Windsor had their tax sale, a property listed on Riverside Drive had a large Income Tax Lien on the property (I can't remember the exact value, but it was more than the house was worth).  I found this out at the land title office, but in the end the property was redeemed.

[bearowski]

I have just finished speaking with a rep from the TO Tax Division and can confirm that the Crown Liens DO survive the tax sale and therefore become the responsibility of the winning Tender.

Also, only two vacant land parcels sold from the inventory posted.

B

[jreist]

Is there a simple or cheap way to find if there is Crown leans on a property both Fed or Prov without going through the cost of a Title Search

Also does anyone know if there are Tax Sales for land with Income Tax owing?

[Rob]

Jreist,

When you purchase a tax sale property, there will be no income tax owing on the property.  (Income tax is directly connected to a person or SIN number).  Now, once you purchase your property (if it is not your primary place of living) each year you will have capital gains on the property (assuming the market continues to increase).  You can either pay the capital gains yearly or once you sell the property you can pay the gains at that time.  Most people wait until they sell the property...  but declaring capital gains in years where certain stocks have fallen might be a good tax strategy.

But you do not need to worry about Income Tax.


Is there a simple and cheap way to go about the purchase without a title search??  Yes, you are not required to do one.  That would be the cheapest option (with risk).  You could make the necessary calls yourself or go to a lawyer.  You could use an online service which would be the easiest way but not necessarily the safest.  Use a lawyer if you are really interested in the property and the property has a house on it.

[JoeT]

I'm not sure if this is the same but during a tax audit 3 years ago by rev Canada decided I owed $25K. During my appeal they sent me a notice to pay the full amount or my 2 properties would be seized. I gave up the appeal and paid, but I'm sure the next step was they would be listed for tax sales.

[gap]

I think they could seize the property (i.e. put a crown lien on them for the amount they say is owing, but it wouldn't end up at a tax sale unless you stopped paying the taxes.   And there would be no problem until you come to sell or refinance the house, which you wouldn't be able to do.   They would get the proceeds up to the amount of their lein and you would be out anyways.  They could get a judgement against you and have the judge request you sell, but this doesn't usually get agreed to by a judge, especially if you could show you had and are still disputing the amount.   (This is my understanding, but I am not a lawyer).  However, since it is rev. can. the judge would probably agree to put a lien on the property for the amount in question (a crown lien).

[Rob]

Gap is exactly right.  That is what they would do, throw a crown lien on one of both of the properties.