Despite purchasing a home in B.C. at the beginning of 2018, Darcy Garneau and his partner still meet the criteria of a satellite family and owe money for the speculation and vacancy tax. (Black Press Media file photo)

New B.C. residents not exempt from speculation and vacancy tax

Darcy Garneau has lived and worked in B.C. for over a year but could still owe money to the province

A B.C. man is not exempt from the speculation tax, despite being a Canadian citizen who lives and works in the province.

Darcy Garneau and his partner were working abroad in the United States but bought a home in Victoria in February 2018.

Despite living and working in B.C. for over a year, a lack of Canadian taxes filed in 2017 makes the couple look like a “satellite family” and therefore puts them in the small margin of the B.C. population who owe money for the speculation and vacancy tax.

ALSO READ: Letters on way to all homeowners in B.C. speculation tax communities

The 2018 speculation and vacancy tax rate is 0.5 per cent of a home’s value. This tax can be offset by a tax credit if the person earns a high enough income.

“Our vacancy tax is nearly $5,000 on a property valued at close to $1 million,” Garneau said in an email. “The minimum income I need to earn as an owner occupant of my home in order to realize enough of a tax credit to offset the vacancy tax is $100,000.”

ALSO READ: Bear Mountain rezoned for spec tax exemption, province says no

Luckily, Garneau was able to land a job with a high enough income, but he knows that many others wouldn’t.

“For argument’s sake, let’s say I did not find a job or earned substantially less the $100,000 needed to earn enough tax credits. In that case, I would be paying the vacancy tax even though I am an owner occupant during 2018,” Garneau said. “I can see where this could affect other Canadians who are returning to B.C. as a retiree. They simply would not meet the income requirements needed to avoid the vacancy tax on their owner-occupied home.”

Garneau believes that the nuances of this tax system unfairly targets some people.

“This act discriminates against new immigrants and returning Canadian citizens,” he said.

ALSO READ: Want to avoid the speculation tax on your vacant home? Rent it out, Horgan says

Garneau sought legal expertise and spoke with Scott Gorski, an associate and tax specialist with Borden Ladner Gervais LLP in Vancouver. Gorski agreed that the tax held unfair expectations for new Canadians.

“The problem for new Canadians is that the speculation tax is not just targeting vacant homes. It is also targeting persons with insufficient income for the government’s liking, even where the home is occupied throughout the year,” Gorski said.

“I have personally only seen a couple of cases involving new Canadians struggling with the speculation tax. However, I have seen many people struggling in a variety of ways outside the context of new Canadian residents as well … In my view, this new tax and the declaration system was not as simple or straightforward as the government thinks; a lot of people struggled with it.”

B.C. Minister of Finance Carole James would not speak directly to Garneau’s case, but issued the following statement on the speculation and vacancy tax.

“We are helping make sure people who live and work in B.C. have a place to call home. We’re helping turn vacant properties into homes for people and ensuring foreign owners and satellite families are paying their fair share,” James said. “Our plan is working. Since May, home prices are moderating in all segments of the market. And all revenue raised through the tax will support affordable housing in the local community.”

nicole.crescenzi@vicnews.com


Send a Tweet: @NicoleCrescenzi

Like us on Facebook  

Just Posted

Sooke cannabis report does little to answer production questions

Council is trying to get ahead of the issue

Indigenous peoples celebrated at Royal Roads

June 21 event includes host of activities as part of National Indigenous Peoples Day

Sidney Museum donates 60,000 Lego bricks to local schools

Sidney, Deep Cove, ḰELSET, Brentwood, Keating and Cordova Bay elementary schools get Lego avalanche

Peninsula food bank ‘desperate’ for donations

Stock “never been this low” at Saanich Peninsula Lions Food Bank as demand outstrips supplies

Victoria Weekender: What’s happening this weekend, June 15-16

Car Free YYJ, a barber battle and an Outdoor Discovery Day

B.C. VIEWS: When farmland protection doesn’t protect farmers

Secondary residences aren’t mansions, families tell Lana Popham

Bombers down B.C. Lions 33-23 in season opener

Former Lion Andrew Harris leads Winnipeg with 148 rushing yards

Northern B.C. family remembers murdered Indigenous woman with memorial walk

Still no closure for Ramona Wilson’s family 25 years later

Monkey spotted on late-night jaunt in Campbell River

Conservation officers also apparently looking for cougar in the area

B.C. university to offer mentorship program for former youth in care

Students using the provincial tuition waiver program will soon be able to form a community at KPU

Cyclists competing in one of the toughest bike races on the planet pass through Fernie

Divide riders looking strong as they finish first leg of 4160 km race

You might not know these B.C. records are public

Hired a lawyer to file a civil claim? Those are published online

B.C. bus driver loses case to get job back after texting while driving full bus

An arbitator ruled that Tim Wesman’s phone usage was a “a reckless disregard for public safety”

Most Read