Affected taxpayers will have payments due in summer 2019
B.C.'s new Speculation and Vacancy Tax Act is now law after receiving Royal Assent on November 27, 2018. It introduces a new speculation tax on residential property located within B.C. Initially proposed in the province's 2018 budget, this tax is intended to target foreign and domestic home owners who do not pay income tax in the province. The speculation and vacancy tax is effective in 2018 and taxpayers must make their first payment by July 2, 2019.
Canadian citizens and permanent residents may be eligible for a reduced 0.5% tax rate (rather than the 1% tax rate, as included in the original draft legislation). This change was included in legislative amendments that were made ahead of Royal Assent.
The legislation also includes several tax relief measures, which may benefit a wide range of B.C. residential property owners. The measures include: details on a number of exemptions; clarifications regarding a related tax credit; information on how the new tax will apply to residential properties held through corporations, partnerships, or trusts. The province initially released these rules as draft legislation under Bill 45 on October 16, 2018 (see KPMG TaxNewsFlash-Canada No. 2018-40, "B.C. Releases Draft Legislation for Speculation Tax").
For more information, contact your KPMG adviser.
Information is current to December 04, 2018. The information contained in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's National Tax Centre at 416.777.8500
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