The statement of adjustments is the least-read and most-queried document in a Calgary purchase. It is not a fee grab — it is the arithmetic of splitting a year's costs between two owners. Here is every line.
At your signing appointment your lawyer will hand you a statement of adjustments, and there is a good chance the bottom line is larger than the number in your head. The most common reaction is that someone has added fees.
Almost always, they have not. The statement exists to divide costs that were paid for a whole year between the person who owned the home for part of it and the person who owns it for the rest. If the seller has already paid this year's property taxes through December, you owe them for the portion of the year you will own the house. That is the entire concept.
The reason it lands hard in Calgary specifically is timing. Our tax year runs January to December, but bills go out in late May and are due at the end of June. Buy in July and the seller has already paid for the rest of your year. Buy in March and they have not paid at all, so the credit runs the other way.
Below is every line you are likely to see, which direction it moves, and what to check.
The statement has two columns. Debits are amounts you owe; credits are amounts already applied on your behalf. The purchase price is your largest debit. Your deposit and your mortgage advance are your largest credits. The difference — plus adjustments and legal fees — is your cash to close.
Everything is split at the possession date. Costs relating to the period before it belong to the seller; costs from that date forward belong to you. Your lawyer prorates each shared item by the exact number of days.
Your lawyer, using the contract, the tax roll, the condo estoppel certificate if applicable, and your lender's instructions. The seller's lawyer prepares a mirror-image version. The two firms reconcile before closing.
This is the meeting for it. Your lawyer can walk you through any line in about a minute. Querying an adjustment two weeks after possession is far more work for everyone and occasionally too late.
City of Calgary property taxes cover the calendar year, January 1 to December 31. Assessment notices arrive in January; tax bills are mailed in late May and are typically due at the end of June. That means for roughly five months of each year, taxes for the whole year are unpaid — and for the remaining seven, they are paid well in advance.
Say you take possession on August 1 and the seller paid the full year in June. They have paid for August through December — five months of your ownership. You reimburse them for those months on the statement of adjustments. On a home with $4,200 in annual taxes, that is roughly $1,750 added to your cash to close.
Take possession on March 1 and nobody has paid the year's taxes yet. The seller owes for January and February, so you receive a credit for their share — and then you pay the full bill when it arrives in June. The credit reduces your closing costs but the June bill is entirely yours to fund. Do not spend the credit and then be surprised in June.
The adjustment should be based on the actual current-year levy where it is known. Early in the year, before the levy is set, lawyers often estimate from the prior year and the statement may provide for a later adjustment. Ask which basis was used.
The City of Calgary's Tax Instalment Payment Plan lets owners pay property tax monthly by automatic withdrawal instead of in one June payment. Many Calgary owners are on it, and it changes how your adjustment is calculated — a seller on TIPP has paid only the instalments made to date, not the full year.
This is the part that goes wrong. A seller on TIPP who does not cancel the plan can continue having withdrawals taken for a property they no longer own, and the account gets tangled. The seller is responsible for cancelling, and their lawyer should confirm it — but it is worth having asked.
TIPP does not transfer with the property. If you want to pay monthly, you apply to the City yourself after possession, and there are timing rules about when you can join — joining later in the year may require a catch-up payment for the months already elapsed. Applying well before the June deadline is the simplest path.
Some mortgages include property tax in the payment, with the lender remitting to the City on your behalf. If yours does, do not also enrol in TIPP — you would be paying twice. Confirm with your lender which arrangement applies, because both buyer-paid and lender-paid structures are common in Calgary.
Condo contributions are billed monthly and almost always paid at the start of the month. If you take possession on the 12th, the seller has paid for the whole month, so you reimburse them for the 12th onward — a small, straightforward line.
These are not routine and they are worth attention. Who pays a special assessment — and whether it is paid in full at closing or continues in instalments — depends on when it was levied and what your contract says. The estoppel certificate states the position for your specific unit. If a special assessment appears anywhere in your documents, ask your lawyer directly who is responsible for what.
After possession, arrange payment of condo fees with the management company — usually pre-authorized debit. The seller's arrangement ends with their ownership, and a missed first contribution starts your relationship with the corporation badly.
If the corporation has approved a fee increase effective shortly after your possession, the adjustment reflects the current fee but your actual cost will be the new one. The budget and minutes in the document package will have told you this was coming.
Electricity, natural gas, and water are typically handled by final meter readings rather than on the statement. The seller closes their accounts effective possession day and you open yours. Set this up before possession — and photograph the meters on possession day so you have your own record if a bill looks wrong.
Your deposit appears as a credit. It has been sitting in the listing brokerage's trust account since the beginning and is applied against the purchase price here.
If your mortgage's interest adjustment date differs from your possession date, a small interest amount may appear. This is normal and usually minor — your lender is squaring up interest between the advance and the start of your regular payment schedule.
Anything agreed during the transaction — a price adjustment for an inspection finding, a holdback, a credit toward repairs — appears here as a credit to you. Check that it is present and correct, at the amount you agreed. This is the most common genuine error on a statement of adjustments, and it is your job to catch it.
Find the cash-to-close figure first and compare it with what you were expecting. If it is materially different, work upward until you find the line that explains the gap. Usually it is the property tax adjustment.
Purchase price matches the contract. Deposit credited at the full amount you paid. Mortgage advance matches your approval. Property tax adjustment prorated from the correct date. Those four cover the great majority of the statement.
Every credit you negotiated should be there. Condo fees prorated from the right day. Legal fees at the quoted amount. Disbursements itemized rather than lumped into a single unexplained figure.
Your lawyer explains these all day. There is no such thing as a question too basic, and the signing appointment is precisely when to ask. If a number still does not make sense to you, call us — we read these constantly and we would rather look at it with you than have you sign something you do not understand.
Because Calgary property taxes cover the calendar year and are usually paid in one payment at the end of June. If you take possession after the seller has already paid the full year, you are reimbursing them for the months you will own the home. On a home with $4,200 in annual taxes, an August possession means roughly $1,750 added to your cash to close.
Then the adjustment runs in your favour. Taxes for the year are unpaid, so you receive a credit for the seller's share of the year at closing. The catch is that the full bill arrives in late May and is due at the end of June — and it is entirely yours to pay. Set the credit aside rather than spending it.
No. The City of Calgary's Tax Instalment Payment Plan does not transfer with the property. The seller is responsible for cancelling their plan, and you must apply yourself if you want to pay monthly. Joining later in the year may require a catch-up payment for months already elapsed, so apply well ahead of the June deadline.
No — you would be paying twice. Some Calgary mortgages include property tax in the regular payment with the lender remitting to the City on your behalf, and others leave taxes entirely to you. Both structures are common, so confirm with your lender which applies before enrolling in anything.
Usually not. Electricity, natural gas and water are normally handled by final meter readings — the seller closes their accounts effective possession day and you open yours. Arrange your accounts before possession so there is no interruption, and photograph the meters on possession day so you have your own record if a final bill looks wrong.
A credit you negotiated being left off — a price adjustment for an inspection finding, a holdback, or a repair credit. Nobody will catch it for you. Check at your signing appointment that every credit agreed during the transaction appears, at the amount you agreed, and query anything missing before you sign.
It depends on when the assessment was levied and what your purchase contract says, and the estoppel certificate states the position for your specific unit. Some are settled in full at closing; others continue in instalments a new owner inherits. If a special assessment appears anywhere in your documents, ask your lawyer directly and explicitly who is responsible for what.
Yes, permanently. It records your true cost base for the property, which matters if you ever need to calculate capital gains on a property that is not your principal residence. File it with your lawyer's reporting letter, the registered title and your mortgage documents.
We tell our buyers what their adjustments are likely to look like before the signing appointment — especially the property tax line, which depends entirely on what month you take possession.
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