Empty Home Tax
Advance tax notices in Vancouver are sent out by the City during the last week of November. This year, for the first time, the advance tax notices will include instructions on how to submit your “Property Status Declaration”.
What is the Empty Home Tax?
The Empty Home Tax, also known as the Vacancy Tax, has been initiated by the City of Vancouver to address the issue surrounding empty or under-utilized properties. Properties deemed to be “empty” or “vacant” will be assessed a tax equal to 1% of the property’s assessed taxable value.
Does the Tax apply to you?
Properties used as a principal residence by the owner, his/her family member, or a friend for at least six months of the year will not be subject to the Empty Home Tax.
Secondly, properties rented for a minimum of six months of the year, in periods of 30 or more consecutive days will not be subject to the Empty Home Tax.
Lastly, there are exemptions, for example, the estate of a deceased will not be subject to the Empty Home Tax because the registered owner is deceased and a grant of probate or administration of the estate is pending. Further exemptions can be found here.
Informing the City of the Property Status
Advance tax notices in Vancouver are sent out by the City during the last week of November of each year. This year, for the first time, the advance tax notices will include instructions on how to submit your “property status declaration”. The property status declaration for the year 2017 is due by February 2, 2018. If a property status declaration is not filed by February 2, 2018 the owner of the property will be assessed the Empty Home Tax along with a penalty of $250.00 for failing to file the declaration.
The property status declaration can be filed online and you will need your folio number and access code. This information can be found on your property tax notice. Additionally you may require additional information depending on the occupancy of the property. For example, a rental property will require the full names of the tenant(s) listed on the tenancy agreements.
Care needs to be taken that a false declaration is not filed as it could result in fines up to $10,000.00 per day of the continuing offense, in addition to payment of the tax.
When is the Empty Home Tax Due?
Properties assessed the Empty Home Tax will have until April 16th, 2018 to pay the Empty Home Tax. Late and unpaid Empty Home Taxes are subject to the same penalties as non-payment of property taxes, including:
- Late payment penalty of 5%
- Daily interest on arrears
- The tax sale process
Any unpaid Empty Home Tax will be added to the property tax bill – December 31st.
What if you miss the February 2nd Deadline and Property isn’t Empty
If you happen to miss the February 2nd deadline, or make an error in the declaration, you may submit a Notice of Complain with the City until March 15, 2018.
With the introduction of the Empty Home Tax it is important that care is taken when purchasing property. The purchaser needs to ensure that they will not be on the hook for the vendor’s Empty Home Tax. Ensure that you speak to your real estate agent with regards to any potential tax and should you have any questions or concerns do not hesitate to contact our office to speak to one of our Real Estate lawyers.