Homeowners are beginning to receive speculation tax declarations in the mail. Read on to find out if you're exempt.
If you're a homeowner in an urban centre in B.C., you may have already received a speculation and vacancy tax letter from the provincial government. If not, it's probably on the way.
The tax rate is 0.5 per cent of your home's assessed value, based on property owned Dec. 31, 2018. It will increase for many people next year, but that gets a little more complicated.
And here's the thing: Most people don't have to pay it at all.
It's important not to confuse the provincial tax with Vancouver's empty homes tax, which is similar in some ways — In both cases homeowners need to submit a declaration to avoid paying the tax — but is completely separate. For Vancouverites, the deadline to declare for the municipal empty homes tax is Feb. 4.
The speculation and vacancy tax declaration is due March 31.
Not everyone who owns a home in B.C. needs to worry about the speculation and vacancy tax. According to the provincial government, the tax "is a key measure in tackling the housing crisis in major urban centres in British Columbia."
The taxable regions include:
Within these areas, any reserve lands, treaty lands, or self-government First Nations are exempt.
If your home is outside the taxable regions, don't expect to find a declaration letter in your mailbox. This issue isn't about you (or your home).
If your home is in one of the affected areas, you still may not have to pay the tax.
Is it owned by an Indigenous Nation, a government or public body, a registered charity, or housing co-op? If so, you're exempt. Even some types of not-for-profit organizations can avoid the tax.
If you fall into one of these categories and didn't receive a declaration letter, don't sweat it — you're good to go.
If you did receive a letter, but fall into one of these categories, the B.C. government does expect you to submit the declaration.
OK, you've followed this far and still appear to be facing the tax — but not so fast.
According to the provincial government, more than 99 per cent of British Columbians will be exempt. The government says the tax is designed to "target foreign and domestic speculators who own residences in B.C. but don't pay taxes here."
So, is your residential property your primary home? Great, you're exempt.
Did you rent out the property for three months or more last year? You're exempt. As of 2019, you'll have to rent out a home that isn't your principal residence for at least six months to avoid the tax.
That's it, go ahead and fill out your declaration.
Or if you haven't received one by late February, contact the B.C. government at spectaxinfo@gov.bc.ca, or call toll-free: 1-833-554-2323.
If you've failed to qualify for an exemption, and have to fork over 0.5 per cent of your home's assessed value, the B.C. government expects payment by July 2.
Rafferty Baker is a Video journalist with CBC News, based in Vancouver, as well as a writer and producer of the CBC podcast series, Pressure Cooker. You can find his stories on CBC Radio, television, and online at cbc.ca/bc.
