British Columbia’s speculation and vacancy tax is an annual tax on residential property in designated parts of the province, aimed at homes left empty. For the 2026 tax year, Canadian citizens and permanent residents owe 1% of a property’s assessed value on a taxable home, and foreign owners and untaxed worldwide earners owe 3%.1Government of British Columbia. Tax Rates for the Speculation and Vacancy Tax Every owner of residential property in a taxable area has to file a declaration by March 31 each year, even when an exemption applies.2Government of British Columbia. Speculation and Vacancy Tax
Who Pays Which Rate
The rates doubled starting in 2026. Between 2019 and 2025, Canadian citizens and permanent residents paid 0.5% and foreign owners paid 2%; those figures are now 1% and 3%.1Government of British Columbia. Tax Rates for the Speculation and Vacancy Tax
The 1% rate covers Canadian citizens or permanent residents who are not classified as untaxed worldwide earners. The 3% rate covers foreign owners and untaxed worldwide earners, a category that includes members of satellite families. An untaxed worldwide earner is someone whose household reports less than a prescribed share of its total worldwide income on a Canadian tax return. A Canadian citizen who earns most of their income abroad can therefore still be taxed at the 3% rate.1Government of British Columbia. Tax Rates for the Speculation and Vacancy Tax
The tax is calculated on the assessed value determined by BC Assessment.
Where the Tax Applies
The tax applies only in specific municipalities and regional districts. As of 2026, the designated areas cover most of Metro Vancouver (including Vancouver, Burnaby, Surrey, Richmond, Coquitlam, and surrounding municipalities, plus UBC lands and the University Endowment Lands), the Capital Regional District on Vancouver Island (Victoria, Saanich, Langford, Colwood, Oak Bay, Sidney, Sooke, and neighbouring communities), and a growing list of other municipalities including Abbotsford, Chilliwack, Mission, Kelowna, West Kelowna, Kamloops, Nanaimo, Parksville, Qualicum Beach, Courtenay, Comox, Duncan, Penticton, Vernon, Salmon Arm, and Squamish.3Government of British Columbia. Taxable Areas for the Speculation and Vacancy Tax
Reserve lands, treaty lands, and lands of self-governing Indigenous Nations are excluded. Islands accessible only by air or water are excluded too, with the exception of Vancouver Island itself. The Predator Ridge resort area inside the City of Vernon is specifically carved out.3Government of British Columbia. Taxable Areas for the Speculation and Vacancy Tax
One boundary worth flagging if you own in the City of Vancouver: the provincial speculation and vacancy tax and Vancouver’s municipal Empty Homes Tax are separate. You file separate declarations for each, and you can be exempt from one and still owe the other.4Government of British Columbia. How the Speculation and Vacancy Tax Works The Empty Homes Tax rate is currently 3% of assessed value on top of any provincial tax.5City of Vancouver. Empty Homes Tax
Exemptions That Take You Out of the Tax
You can avoid the tax entirely by proving the property serves a genuine residential purpose. You still have to file a declaration on time; the exemption is claimed during the declaration process, not after an assessment arrives.
Principal Residence
The most common exemption covers the home you actually live in. You must occupy the property for a longer period during the calendar year than you live anywhere else, and you must be a Canadian citizen or permanent resident, a B.C. resident for income tax purposes, and not an untaxed worldwide earner.6Government of British Columbia. Exemptions for Individuals for the Speculation and Vacancy Tax Driver’s licences, utility bills, and CRA correspondence showing your B.C. address help substantiate the claim if you’re audited.
Renting the Property Out
If you don’t live in the home yourself, renting it out qualifies, but only if the tenancy meets minimum thresholds. Tenants must occupy the property for at least six months of the year, and each individual tenancy must last at least one month. You can combine tenancies from different tenants, or mix arm’s-length and non-arm’s-length arrangements, to reach six months.7Government of British Columbia. Tenancy Requirements for the Speculation and Vacancy Tax Exemptions Written tenancy agreements and rent payment records at fair market rates matter here, because undocumented or below-market arrangements draw scrutiny in an audit.
Medical Situations
Two medical situations qualify. A secondary residence that you, your spouse, or your child periodically occupies to access treatment at a nearby facility is exempt, whether the child is a minor or an adult; you’ll need written documentation from a medical practitioner or nurse practitioner. Owners who must leave their principal residence for prolonged medical care can also qualify, with documentation of the medical necessity and the duration of absence.6Government of British Columbia. Exemptions for Individuals for the Speculation and Vacancy Tax
Uninhabitable Property
If a property becomes uninhabitable for at least 60 consecutive days during the calendar year due to a disaster or hazardous condition beyond your control, you can claim an exemption. It covers the year the damage occurred and the following year if repairs aren’t finished by March 1. The exemption does not apply if the home was already uninhabitable before the event.6Government of British Columbia. Exemptions for Individuals for the Speculation and Vacancy Tax
Death of an Owner
When a property owner dies, an exemption applies for the year of death and the year immediately following. The executor or personal representative of the estate files the declaration on the deceased owner’s behalf; powers of attorney are no longer valid after death. For joint tenancy, the surviving owner claims the exemption. For tenants-in-common arrangements, all owners including the estate representative can claim it.8Government of British Columbia. Special Circumstances with the Speculation and Vacancy Tax You’ll need the deceased owner’s declaration letter (with Letter ID and Declaration Code), their Social Insurance Number, birthdate, and date of death. The province may also request a copy of the will.
Strata Rental Restrictions Do Not Exempt You
A common misconception: strata bylaws that prohibit or restrict rentals do not exempt you from the tax. A phased-out exemption for properties with rental restrictions existed for the 2018 through 2021 tax years but no longer applies.6Government of British Columbia. Exemptions for Individuals for the Speculation and Vacancy Tax If your strata limits rentals, you’ll need to occupy the unit yourself, get the bylaws changed, or pay the tax.
Property Held Through a Corporation, Partnership, or Trust
The tax also reaches property held indirectly. For corporations, the province identifies “corporate interest holders”: anyone with at least 25% of the corporation’s equity or voting rights, anyone who can appoint or remove most of the board, or anyone exercising significant influence over the corporation’s decisions. A corporation without any corporate interest holder is taxed at the highest rate. For trusts, the province identifies “beneficial owners” who have the right to receive benefit from the property, generally the beneficiaries. Estates are treated the same way as trusts.9Government of British Columbia. Terms and Definitions for the Speculation and Vacancy Tax
Filing the Annual Declaration
Every owner of residential property in a taxable area receives a declaration letter each year with a unique Letter ID and Declaration Code.2Government of British Columbia. Speculation and Vacancy Tax These codes change annually and are required to access the online filing portal. You’ll also need your Social Insurance Number and two property identifiers: the Folio Number and the nine-digit Parcel Identifier (PID). Both appear on the declaration letter, BC Assessment notices, and municipal tax bills.
You can file online or by phone. The deadline is March 31. When multiple people own a single property, each owner submits a separate declaration covering their specific interest.
The B.C. Resident Tax Credit
Qualifying B.C. residents receive a non-refundable tax credit that can eliminate or reduce the amount owed. For 2026 and subsequent years, the maximum credit is $4,000 per owner.10Government of British Columbia. Speculation and Vacancy Tax Credit for B.C. Residents If the credit exceeds what you owe, your balance drops to zero; there is no refund of the difference, and unused credit cannot be carried forward or transferred to a spouse.
To qualify, as of December 31 of the tax year, you must be a B.C. resident for income tax purposes, a Canadian citizen or permanent resident (or a confirmed B.C. Provincial Nominee), and not part of a satellite family or otherwise classified as an untaxed worldwide earner. The credit scales with your ownership share, so 25% ownership yields 25% of the $4,000 cap. You don’t apply separately; it’s applied automatically to your Notice of Assessment when you qualify.11Government of British Columbia. Tax Credits for the Speculation and Vacancy Tax The credit can be applied across one or more properties in the same tax year but cannot cover balances from previous years.
Payment, Late Filing, and Penalties
After your declaration is processed and tax is owing, you receive a Notice of Assessment by mail. The payment deadline for 2026 is July 2 (the first business day in July).2Government of British Columbia. Speculation and Vacancy Tax You can pay as soon as the notice arrives. Options include online banking, wire transfer, in-person payment at government offices, and cheques mailed to the designated tax office.
Missing the March 31 declaration deadline triggers an automatic assessment at the maximum rate, which is 3% for the 2026 tax year. The province may examine and process late declarations, but there’s no guarantee you’ll receive credit for an exemption you failed to claim on time.8Government of British Columbia. Special Circumstances with the Speculation and Vacancy Tax Missing the payment deadline adds a 10% penalty on the outstanding balance, and interest starts accruing on top of that.4Government of British Columbia. How the Speculation and Vacancy Tax Works Unpaid balances can eventually result in liens against the property title.
Appealing an Assessment
If you think the tax was applied incorrectly, you can appeal to the minister. Calling the ministry first is worth doing, because they can answer questions about exemptions and credits and may resolve the issue without a formal process; contacting them does not start the appeal clock.12Government of British Columbia. Assessments and Appeals for the Speculation and Vacancy Tax
You still have to pay the assessed amount while the appeal is pending. Filing does not pause or reduce the balance owing. If a change to your income tax status or a Persons with Disabilities designation affects your assessment, you have 90 days from receiving the relevant documentation to notify the ministry.12Government of British Columbia. Assessments and Appeals for the Speculation and Vacancy Tax If BC Assessment revises a past property valuation, any resulting changes to your speculation tax assessment happen automatically.