Vancouver City Council has resolved to impose an annual vacancy tax (the Empty Homes Tax).
The tax will come into effect in January 2017, but it will not be assessed and payable until 2018. In general, the new tax will target residences that are unoccupied for six months or more per year, unless they qualify for an exemption. The new tax is equal to 1% of the property's tax assessed value and is in addition to existing property tax.
Principal residences will not be charged the Empty Homes Tax—a principal residence is generally the usual place where an individual lives, makes his or her home and conducts daily affairs. Also, the tax will not apply to properties that are rented long-term, or if they have been rented for at least 30 days in a row for at least six months over the course of the year.
There are several exemptions for this tax, including circumstances where:
Earlier this year, B.C enacted legislation imposing an additional 15% property transfer tax on foreign entities purchasing residential property in the Greater Vancouver Regional District. The legislation also provided legislative authority to implement a vacancy tax on empty homes in Vancouver.
For more information, contact your KPMG adviser.
Information is current to November 22, 2016. 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