BC Speculation and Vacancy Tax – Declaration Due by March 31, 2019
If you owned a residential property in BC on December 31, 2018 and if the property was located in one of the designated taxable regions, you must complete an annual declaration for the Speculation and Vacancy Tax (“SV tax”).
By now you should have received an SV tax declaration letter from BC in the mail. The annual declaration must be filed by March 31, 2019. If you owe SV tax, the payment is due by July 2, 2019. In cases where there are multiple owners of a property, a declaration must be completed by each owner, including spouses.
You can file your declaration online by going to the link below and completing the required information or you can file your declaration by calling 1-833-554-2323.
If you do not complete your declaration, you will receive a tax notice charging you the SV tax.
For more information on the specific details of the SV tax, refer to the article in our Fall 2018 Tax Newsletter by following the link below.
Please contact us if you require assistance with the completion of your SV tax declaration or if you have any questions with respect to the SV tax.
Beware – Changes to applicability of BC PST and MRDT
BC PST and Municipal and Regional District Tax (“MRDT”) applies and always has applied on taxable accommodations provided in BC.
There used to be an exemption from the PST and MRDT for accommodation that is provided by a person who offers fewer than 4 units of accommodation. Effective October 1, 2018, this exemption has been eliminated.
There are other exemptions, including an exemption if the property is only listed on an online accommodation platform (such as AirBNB or VRBO) and that online accommodation platform is registered to collect PST and MRDT. However, other than this online accommodation exemption, for the most part anyone who owns a property in BC and rents it for the purposes of short-term accommodation will be required to charge PST on the rental and if the property is located in a designated accommodation area, MRDT will be required to be charged on the rental as well.
If the gross revenue from the rental of the property for the previous 12 months is less than $2,500 and if it can be reasonably estimated that the gross revenue for the following 12 months will be less than $2,500, PST and MRDT will not be applicable.
The BC PST rate on accommodations is 8% and the MRDT is either 2% or 3% depending on the area in which the property is located (for instance, the MRDT rate in Fernie is 2% and in Kelowna it is 3%).
If you own a property in BC that you are renting for short-term accommodation, and your annual gross revenue from the rental of the property is above the threshold, and if a specific exemption does not apply to your situation, you will need to register for BC PST and start charging the PST and MRDT as soon as possible. Note, whether or not the MRDT has to be charged and the rate at which the MRDT has to be charged depends on the designated accommodation area in which the property is located. If the property is not located in a designated accommodation area, the MRDT does not apply, however, the PST will still apply.
For more detailed information with respect to how PST and MRDT apply to accommodation in BC, follow the link below to Bulletin PST 120 (there is a list of designated accommodation areas provided on pages 17 to 19 of Bulletin PST 120).
Please contact us if you have any questions with respect to BC PST and MRDT or if you require assistance with PST registration.