What Presale Investors Can Actually Write Off (BC, 2026)

Almost nothing you pay on a BC presale before completion is tax-deductible. Not the deposit, not the interest if you borrowed to fund it, not the GST or property transfer tax you hand over on closing day. Until a tenant moves in, you own a contract — not a source of rental income — and the CRA gives you no rental statement to deduct against. On a typical $520,000 Surrey one-bedroom, that means roughly $12,400 of pre-completion interest producing a $0 write-off, and the real deduction only starting at completion. "It's all a write-off" is one of the most expensive sentences in a presentation centre. We represent buyers only and get paid the same whether you buy or walk, so here is the actual 2026 picture — what you can deduct, what quietly disappears, and what gets added to your cost base instead. The rule that catches almost everyone Canadian tax deductions attach to a source of income . Under paragraph 20 1 c of the Income Tax Act, interest is deductible only when the borrowed money is used for the purpose of earning income from a business or property — and CRA's Income Tax Folio S3-F6-C1 is explicit that there must be a reasonable expectation of income from that use. A presale deposit doesn't buy an income-producing asset. It buys a contractual right to purchase one, years from now. There's no rent, no T776 rental statement, and therefore nothing to deduct against. The building's construction is being done by the developer, on the developer's books — not yours. The clock that matters for an investor isn't the contract date or the completion date — it's the day the unit becomes available for use and rented . Before that day, your deductions are essentially zero. After it, they're real. What's deductible, and when What you pay Before completion Once rented Deposit instalments Not deductible — it's your capital Forms part of adjusted cost base Interest on money borrowed for the deposit Not deductible — no income source Deductible going forward if the borrowing is traced to the rental GST 5% on the purchase Not deductible; no input tax credit on residential rental Added to cost base; NRRP rebate only if FMV under $450,000 Property transfer tax Not deductible Added to…

This article is part of the PresaleProperties.com BC real estate guide library. It is intended for buyers comparing presale condos, townhomes, assignments, deposits, completion timelines, neighbourhoods and developer incentives across Metro Vancouver and the Fraser Valley.

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