British Columbia’s new Speculation and Vacancy tax is an annual tax for owners of residential property in certain taxable regions of B.C. The main idea behind this new BC tax is to discourage housing speculation and encourage owners of vacant houses to make these properties available for rental. Thankfully, the BC NDP government has claimed that “99% of British Columbians are expected to be exempt from the tax”.
It is with this exemption that the issue lies. If you are a registered property owner, you must declare yourself exempt from the tax, or you will be expected to pay the full amount.
First, the following areas are eligible to be taxed:
- Municipalities within the Capital Regional District. This excludes Salt Spring Island, Juan de Fuca Electoral Area and the Southern Gulf Islands
- Municipalities within the Metro Vancouver Regional District, excluding Bowen Island, the Village of Lions Bay and Electoral area A, but including UBC and the University Endowment Lands
- The City of Abbotsford
- The District of Mission
- The City of Chilliwack
- The City of Kelowna
- The City of West Kelowna
- The City of Nanaimo
- The District of Lantzvill
If your property is located in one of these areas, you must either declare exemption or pay the tax.
How and When Do I Declare the Exemption?
In order to declare exemption, you must live on the property as your primary residence, or rent out the property for at least 3 months of the year. Short term rentals do not count towards this allowance.
To claim exemption, you should have received a letter from the government listing all the properties you are the owner of. These letters contain directions on how to go online and submit a declaration of exemption if you meet the above criteria. Failure to submit the declaration would result in being charged the new BC tax, payable by July 2, 2019.
Unfortunately, if you own recreational property within one of the applicable zones, and do not rent it out long term, you will have to pay the new tax on it.
For more information, check out;