What is the Empty Homes Tax?
The Empty Homes Tax also known as the Vacancy Tax is for properties in the City of Vancouver deemed empty for more than 6 months of the year. Most homes will be exempt if they are principal residences or rented out for at least 6 months of the year. All owners must make a status declaration by Feb. 4, 2019 or be automatically assessed the tax and/or a $250 penalty.
The goal of this initiative is to help relieve pressure on Vancouver’s rental housing market by returning empty or under utilized properties to use as long-term rental homes for people who live and work in Vancouver.
Note: The City of Vancouver’s Empty Homes Tax is separate from BC’s Provincial Speculation and Vacancy Tax. If you are not exempt, it is possible that both taxes may apply to property in Vancouver.
How is it calculated?
The Empty Homes Tax is calculated based on 1% of a property’s assessed taxable value of the previous year. For example, if you do not meet the Empty Home Tax exemptions and your property is assessed at $850,000.00 as of the previous tax year, you would be required to pay $8,500.00. This is a lot of money for majority of the population in Greater Vancouver and that’s why it is important to declare that your property is exempt from the Empty Home Tax should you meet the exemption requirements.
What properties are not subject to Empty Home Tax ( or Vacancy Tax)?
The following will not be subject to Empty Home Tax:
- Properties used as a principle residence by the owner, his/her family member, or other permitted occupier like a tenant for at least six months of the 2018 year will be exempt.
- Properties rented for residential purpose for at least six months of the current year (rental periods must be 30 consecutive days or more in order to count towards the 6 months) will be exempt.
- The property meets one of the following exemptions
Does the Empty Home Tax apply to all residential properties in the Lower Mainland?
The Empty Homes Tax only applies to Class 1 Residential properties within the city of Vancouver.
If your property is located in a municipality that does not fall within the city of Vancouver, such as the University Endowment Lands, Burnaby or Surrey, the tax will not apply.
Is the Empty Home Tax the same as the Speculation Tax and Vacancy Tax?
No, the Empty Home Tax only applies to properties that are located in the City of Vancouver where as Speculation Tax is provincial and applies to all properties located in taxable regions in BC.
If a property has joint owners, is each owner required to make a property status declaration?
An Empty Homes Tax property status declaration is required for each parcel of Class 1 residential property and only one registered owner can submit the declaration. Any additional owners will not be able to submit a second property status declaration.
Author: Meryl Hamdillah is a REALTOR with Sutton WestCoast Group and is an active community writer in Tri-Cities and Vancouver. If you are interested in a real estate or community topic in Tri-Cities or Metro Vancouver, feel free to call me.
How to declare and what is the deadline to declare property Status for Empty Homes Tax?
CLICK HERE to Declare online by February 4th . You will need your FOLIO number and access code from your property assessment.
or if you don’t have your FOLIO number call City Hall 604-873-7000.Empty-Homes-Tax-Property-Status-Declaration
I have other reasons why my property cannot be tenanted or occupied. Do I qualify for an exemption?
According to the City of Vancouver, it is reported that 99% of the population in City of Vancouver will not be affected by the Empty Home Tax as most property owners in the city use their property as their principal residence or are renting it out to tenants for more than six months or more. However, there are some special circumstances where property owners may not be able to have the property occupied and may be other exemptions may be possible. A few of the major exemptions are mentioned below.
Owner or Tenant in Medical Care
My property was unoccupied for more than six months because my tenant was residing in a hospital, long term care or supportive carefacility; however, they have been using the property as a principal residence *
This exemption does not apply to second homes that are used occasionally to receive medical care in Vancouver.
All occupants must be residing in a care facility for the exemption to apply.
This exemption is not allowed for more than two consecutive tax years
Under Construction or Renovation
My property was unoccupied for more than 6 months because it is undergoing a major renovation. Would I be exempt from the Empty Home Tax?
Under Re-zoning or Re-development
I own a vacant land that has been unoccupied for more than 6 months because it is undergoing a redevelopment . Would I be exempt from the Exempt Home Tax?
Yes, you would be exempt however you will need to provide short description of the redevelopment project along with the building or development permit number issued by City
I have a residential property that is vacant and is part of a phased development. Would I be exempt from the Empty Home Tax?
Yes, you would be exempt from Empty Home Tax on condition that the property described meet the following criteria: a) a rezoning application under review b) an approved rezoning with permits under review and/or c) an approved rezoning where construction has commenced.
Conservation of Heritage
I have a residential property that has been unoccupied for more than 6 months because I am in process of applying for conservation of heritage property. Would I be exempt from Empty Home Tax?
Yes, you would be exempt. In case you get audited, be sure to maintain any records from the city or the contractor showing the building or development permit number.
I have a residential property that has been unoccupied for more than 6 months because there is restriction in the number of units that may be rented in my building.
Yes you would be exempt Empty Home Tax on condition that it is subject to a strata rental bylaw as of November 16, 2016 that prohibits rentals and the maximum allowable number of rentals had already been reached. In case you get an audit, you will need to ensure that you have one or more of the following:
- a copy of strata bylaws,
- a letter from strata council confirming maximum number of units e.g. Rental Disclosure Statement or Form B information certificate; or
- a copy of the waitlist from the strata council confirming you have attempted to rent the property
Note: This exemption does not apply to properties where the number of permitted strata rentals decreased on or after November 16, 2016.
I have a residential property that has been unoccupied for more than 6 months because it is the subject of a court order. Would I be exempt from Empty Home Tax?
Yes, you will be exempt from Empty Home Tax on condition that you’ve used your best efforts to permit occupancy according with timelines in the court order. In case you get an audit, it is important to keep a copy of the court order. This court order type exemption also applies to owners who were prohibited from selling, occupying or renting their property.
Limited Residential Use
I have a residential property that has not been occupied for more than 6 months because it is used as vehicle parking.
Yes, you would be exempt from Empty Home Tax if your property has limited to use to parking or is the result of the size, shape or other inherent limitation of the parcel where a residential building could be constructed. In case you get an audit, you will need to provide land survey or legal description that clearly illustrates the limitations of the property
Owner passed away
I am the administrator for my late father’s property that has not been occupied for six months and I am still waiting for a grant of probate or administration to be issued. Would the property be exempt from Empty Home Tax?
Yes, the property would be exempt as long as the grant of probate is still pending. This exemption would not apply if a grant of administration or probate was issued by a date that would have allowed the property to have been occupied for six months of the calendar year.