With municipal and rural property tax deadlines just around the corner, home owners can look into several provincial programs that may help with some of the financial pressures of home ownership.
Municipalities set the deadline for payment of municipal property taxes. Rural property taxes are due July 4, 2016. After July 4, a 5% penalty is applied to unpaid rural property taxes, including any unclaimed home owner grant.
Home owner grant:
If you’re a home owner, remember to apply for your home owner grant when you pay your property tax. This grant helps keep residential property taxes affordable for British Columbians by returning almost $800 million to families every year. British Columbians who own homes valued up to $1.2 million may be eligible to receive a full home owner grant this year. For properties assessed above this threshold, the grant is reduced by $5 for every $1,000 of assessed value in excess of the threshold.
There are two types of home owner grants:
- The basic grant can reduce residential property taxes on an owner’s principal residence by up to $570, or if the home is located in a northern and rural area, up to $770.
- The additional grant can reduce residential property taxes on an owner’s principal residence by up to up to $845 or, if the home is located in a northern and rural area, up to $1,045. The additional grant is available to home owners who are 65 years or older, who qualify under the persons with disabilities category, or who are the surviving spouse of a veteran who received certain war-veteran allowances.
Low-income grant supplement:
Low-income home owners who would have received the additional home owner grant can apply for a low-income supplement, which replaces any reduction in the grant caused by having a property valued over the threshold. The low-income supplement is available to seniors, certain veterans or their surviving spouse and persons with disabilities.
Property tax deferment program:
The property tax deferment program provides low-interest loans that allow qualifying home owners to defer their property taxes until they sell or transfer ownership of their home, or it becomes part of an estate.
There are two categories under the property tax deferment program. The regular program is for owners age 55 or older, surviving spouses of any age and people with disabilities. The interest rate under the regular program is currently 0.7%. The rate is set equal to prime lending rate, minus 2%.
The families with children program is for parents, step-parents or those who are financially supporting children, and was created to help families during the years when household costs are often highest. The interest rate under the families with children program is currently 2.7%. The rate is set equal to the prime lending rate.
Taxes can be deferred for any year the home owner lives in the home and continues to qualify for the program. Accumulated deferred taxes and interest must be paid when the home is sold or transferred.
- In 2016, 91% of B.C. homes are below the home owner grant threshold and, if eligible, their owners would receive the full grant amount.
- The home owner grant is available to Canadian citizens or permanent residents of Canada who live in B.C.
- The Province reimburses municipalities for the full cost of the home owner grant to ensure municipal revenues are not affected.
- The northern and rural benefit was introduced as part of carbon-tax recycling to recognize the challenges residence in some parts of B.C. face in minimizing their carbon footprint.
- As of April 2016, almost 40,000 B.C. households have benefitted from property tax deferment programs.
Home owner grant: www.gov.bc.ca/home ownergrant
Property tax deferment programs: www.gov.bc.ca/propertytaxdeferment
For information about other programs that support housing affordability, visit: https://news.gov.bc.ca/factsheets/factsheet-supporting-housing-affordability-in-bc