Speculation & Vacancy Tax Act
Navigating the intricacies of the Speculation and Vacancy Tax Act is crucial for property owners in British Columbia. At Infinity Law, we're here to guide you through its implications in the realm of Real Estate Law.
Introduced to address housing speculation and ensure optimal use of residential properties, the Speculation and Vacancy Tax Act came into effect on November 27, 2018. Its primary aim is to transform vacant homes into viable housing options for BC residents and generate revenue for affordable housing projects.
- Over 99% of BC residents are likely exempt, but all homeowners in specified regions must submit a declaration.
- Tax rates differ based on residency status. For BC residents, it's 0.5% of the property's assessed value from 2019 onwards. Foreign owners and satellite families will see an increase from 0.5% in 2018 to 2% from 2019.
- Affected regions include municipalities in the Capital Region District, Metro Vancouver Regional District, and cities like Abbotsford, Chilliwack, Mission, Kelowna, West Kelowna, Nanaimo, and Lantzville.
- Exemptions apply for principal residences or properties rented for at least six months in a year (short-term rentals under one month don't qualify).
- BC homeowners can avail a tax credit up to $2,000 on secondary properties, effectively exempting properties assessed up to $400,000.
Tax Credits and Exemptions:BC homeowners might qualify for a tax credit of up to $2,000 on secondary properties. For homes valued above $400,000, the tax applies only to the amount exceeding this threshold. Foreign owners and satellite families can claim a tax credit equivalent to 20% of their BC income to offset the 2% tax.
Infinity Law, a leading name in Real Estate Law and Civil Litigation in British Columbia, is here to assist you in understanding and navigating this Act. If you have concerns or need clarity on the Speculation and Vacancy Tax Act, reach out to us via our website or call us directly at (250)385-6004 / (888) 385-6004. We're committed to ensuring your real estate ventures are legally sound and optimized.