Governments need money in order to administer their territory. The funds they allocate toward road repair, parks and recreation, schooling, and other programs must, after all, come from somewhere. It comes from you, dear taxpayer. There are a number of ways governments tax their citizens, but the one we will concern ourselves with today is the tax governments charge on homes for sale in Whitby or condos for sale here in Virginia Beach. It's called transfer tax, and you'll have to be familiar with it if you want to properly construct a budget for the purchase of a new home.

A transfer tax, simply put, is what it's called when governments take a cut whenever one person transfers ownership of a piece of property (it could be a Scarborough condo or it could be a chest of tea) to another person. Obviously not all transactions are charged tax. For instance, if you were to sell your old DVD player through the newspaper classifieds, you wouldn't have to give the government anything. Although some governments do get into charging tax when small items are transferred - then it's called sales tax. Mostly though, it's large possessions, like land or houses, that fall victim to transfer tax.

You may be wondering why exactly the government feels that it is entitled to charge you a transfer tax at all. What does you selling a condo in Mississauga to a new owner have to do with the government? The answer is that in order for the transfer to be official, the new name and owner information must be registered by the government. This requires that the government hire a clerk to process these changes, and voila, money must be found to hire said clerk.

Considering that the transfer tax is applicable to the SALE of properties, you may now be thinking that if you simply GAVE your property to a family member (perhaps in exchange for something at a later date) you could avoid being taxed. Unfortunately for you, the government has already thought of that. Mississauga townhomes being given from one person to another will be charged a Gift Tax. If the relative doing the giving is dead and the bequest comes from his or her will, the tax you have to pay on it is called Estate Tax.

Moving out of the realm of hypothetical transfers of Toronto condominiums from one person to another, how much will it cost you in taxes to sell your house in Virginia Beach? There are three taxes you will be charged in this case: state taxes on recording the change and on the actual transfer (Grantee and Grantor Tax) and a county tax on the transfer. You can calculate the expected amount using the online tool at http://www.titlepros.com/calculators/transferRecordTaxes.php.