What is speculation tax?
Lets understand what speculation tax is. Its a tax introduced by government to bring revenue from homes that are sitting vacant. And to bring more homes in market for rent that are vacant. So, the home owner of vacant property has only two options only either rent it out or pay tax. Tax revenue generated from speculation tax will be used for more affordable housing. Most of British Colombians are expected to be exempt from tax. Anyone who doesn’t apply for the exemption will be declared a speculator and will be hit with the tax. And people will have to make this declaration year after year after year. British Colombians will be exempt if they either live in their home as their principal residence or rent out their property for at least three months of the year. Short-term rentals for periods of less than one month do not count towards the three-month total.
Please check if your property comes under speculation tax as not all of BC comes under speculation tax.
Here is the list of exemptions:-
Click on Exemption that applies you to, it will take you to the BC government official site with full details.
- Principal residence exemptions
- Occupied by a tenant
- Can’t live in the residence because it’s uninhabitable
- Secondary residence close to medical treatment facility
- Just bought or inherited the property
- Separation or divorce
- Recent death of owner
- Property is in a trust created by a will for a minor
- Property has rental restrictions
- Property is a strata hotel
- Property includes a licenced child daycare
- No residence on the property
- Other exclusions from the tax
There are more exemptions for Land under development and corporations.
My Main concern is what if you just inherited a strata property that has rental restriction.
To my understanding, i might be wrong, Owners are exempt in the year legally inherited the property from speculation tax. When a covenant or a strata bylaw prevents the property from being rented out in a manner that would allow a rental exemption, all owners of a property are exempt for the 2018 and 2019 tax years only, as long as the rental restriction was in place on or before October 16, 2018. The owner must also have purchased the property before that date.If you just inherited strata property with no rental, then you might want to consult with a lawyer that specializes in Real Estate. I have contacted a lawyer who specializes in Surrey Real Estate to find out will update the blog as soon as i get the information. Please leave your review and information you have.