Finance

Province builds on successful first year of landmark tax

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Finance

Province builds on successful first year of landmark tax

Media Contacts
Ministry of Finance
Media Relations
778 974-3341
Media Contacts
Ministry of Finance
Media Relations
778 974-3341

Backgrounders

The speculation and vacancy tax: what’s new in 2020

The speculation and vacancy tax (SVT) helps turn empty houses into homes for people, discourages real estate speculation and ensures homeowners who report the majority of their income outside of Canada pay their fair share of taxes.

Ahead of the 2020 declaration process, property owners are being notified of the following:

Tax rate increase for foreign owners and satellite families: In its inaugural year, all SVT taxpayers were subject to a tax rate of 0.5%. In the second year, the tax rate rises to 2% for foreign owners and satellite families.

Water-access only properties: Owners who have residential properties that cannot be accessed by road and are not within a short walking distance to a public or private road will be exempt from paying the tax. This change is retroactive to the 2018 tax year.

Canadian Armed Forces (CAF) members: CAF members and their spouses will now qualify for a stand-alone exemption on their residence if they are unable to reside in their home. There is no limit on the number of years that the exemption may be claimed by a CAF member and their spouse, but this exemption can only be applied to one property. This change is retroactive to the 2018 tax year.

Vacant land: All owners who qualified for the vacant land exemption in 2018 will continue to qualify in 2019 if they still meet all exemption criteria. The exemption will now end Dec. 31, 2019.

Strata accommodation properties: All owners of a strata accommodation property, also known as strata hotels, are exempt. The property must meet the definition of strata accommodation as defined in the Assessment Act. The exemption will now end Dec. 31, 2021.

Strata condominiums with rental restrictions: Strata condo property owners who were restricted from renting when the SVT became law will continue to qualify for an exemption. This is a grandfathering exemption, which means new owners and owners subject to new rental restrictions do not qualify. The exemption will now end Dec. 31, 2021.

New declaration requirements to prevent tax avoidance: Every corporation, business partnership or trust will be required to provide the same information on their interest holders as required by individual owners. Corporations that do not have corporate interest holders will be required to verify this in their declaration. In addition, foreign corporations will be required to provide a Canadian business number or certify that they do not have a business number, and Canadian spouses of foreign owners will be required to provide their social insurance number.

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