Empty Home Tax (1%) – Effective early 2017Synergy Mortgage
Chana Charach, MB
Vancouver city council has voted to approve a tax on empty homes, the first of its kind in Canada. Self-reporting owners will be assessed a one per cent tax on homes that are not principal residences or aren’t rented out for at least six months of the year. That means a $1-million home left vacant would be taxed $10,000. The intention is to tax housing in Vancouver on owners who are treating housing as an investment property. They are hoping that the tax will improve Vancouver’s rental vacancy rate, which is currently around 0.6 per cent, by persuading owners of thousands of empty apartments and houses to put them up for rent.
The city will conduct random audits to catch cheaters, and property owners who try to skirt the rules will face penalties. The tax will be implemented in early 2017 with the first payments due in 2018. Homes that are deemed empty will be subject to a tax of 1% of the property’s assessed value. Most homes will not be subject to the tax, as it does not apply to principal residences or homes rented on a long-term basis. Net revenues from the Empty Homes Tax will be reinvested into affordable housing initiatives.
Empty Homes Tax due dates
- Property status declaration (for 2017): February 2, 2018
- Empty Homes Tax payment: April 16, 2018
- Unpaid tax added to property tax bill: December 31, 2018