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Speculation and vacancy tax credit for B.C. residents

Publication date: January 15, 2024

B.C. residents may be eligible to receive a non-refundable speculation and vacancy tax credit to reduce the amount of tax payable if they were not eligible for any of the speculation and vacancy tax exemptions.

To be eligible for the tax credit for B.C. residents, you must have submitted a declaration and meet all of the following qualifications:

  1. As of December 31, you were a resident of B.C. for income tax purposes

  2. You’re one of the following:

  1. You’re not an untaxed worldwide earner (a category of taxpayer that includes members of a satellite family)

If you’re eligible for the tax credit for B.C. residents, the credit will be applied to your account automatically. You do not need to apply. 

If this credit does not apply to you, or if your property is held by a corporation or trust, you may be eligible for the tax credit for other owners.

How much credit can I receive?

You can receive a maximum tax credit of $2,000 that can be applied to one or more properties each year, if you meet the qualifications. The credit is calculated based on your ownership percentage, up to the $2,000 maximum.

For example, if you’re the sole owner of the property, you’re entitled to the full $2,000 tax credit. If you own 25% of the property, you’re entitled to receive 25% of the maximum credit ($500 of the $2,000 maximum) to reduce the tax payable for that property. Your tax payable may be reduced to zero if your property’s assessed value is $400,000 or less.

The tax credit cannot be carried forward to future years or transferred to a spouse.

Since this is a non-refundable tax credit, if your tax credit amount is greater than the tax you owe, your tax liability becomes $0.

Examples

The examples below show how the tax credit for B.C. residents applies based on ownership percentage.

In all examples, the owner is not eligible for an exemption for the property.

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One individual owns 100% of the property

On December 31, a B.C. resident owns 100% of a property assessed at $500,000. They’re liable for tax of $2,500 and qualify for the tax credit.

Tax credit = $2,000 x Percentage ownership

  • $2,000 x 100% = $2,000

Total tax due = Tax payable – Tax credit

  • $2,500 - $2,000 = $500

The total tax due is $500.

 

Two people each own 50% of the property

On December 31, two B.C. residents co-own a property assessed at $500,000 with 50% ownership each. They’re each liable for $1,250 in tax and both qualify for the tax credit.

For each person

Tax credit = $2,000 x Percentage ownership

  • $2,000 x 50% = $1,000

Tax due = Tax payable – Tax credit

  • $1,250 - $1,000 = $250

The total tax due per person is $250.

 

An individual owns 10% of one property and 100% of another property

As of December 31, a B.C. resident owns:

  • 10% of a property assessed at $425,000 (property A)
  • 100% of a second property assessed at $350,000 (property B)

Both properties are liable for the tax and qualify for the tax credit.

Property A

Tax payable = $212.50

Tax credit = $2,000 x Percentage ownership 

  • $2,000 x 10% = $200

Tax due = Tax payable – Tax credit

  • $212.50 - $200 = $12.50

The tax due for property A is $12.50.

Property B

Tax payable = $1,750

Tax credit (remaining) = $2,000 x Percentage ownership – tax credit amount already received for property A

  • $2,000 x 100% – $200 = $1,800

Tax due = Tax payable – Tax credit

  • $1,750 - $1,800 = $0*

*The tax due on property B is $0 since the credit amount is higher than the tax payable for property B, and the credit applied cannot exceed your tax payable on the property.

Total tax due

Total tax due = Tax due for property A + Tax due for property B

  • $12.50 + $0 = $12.50

The total tax due is $12.50.

How do I apply?

There is no application for this tax credit. The credit is automatically applied if you meet the qualifications and the property is subject to the speculation and vacancy tax. If you qualify, you will find the credit applied on your Notice of Assessment. If you have any questions or concerns about how the tax credit is applied, contact us.

This information is provided for your convenience and guidance and is not a replacement for the legislation. 

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Contact us if you have any questions about the speculation and vacancy tax or if you need translation services.