The Speculation and Vacancy Tax

Common questions about the tax

• What is BC’s Speculation and Vacancy Tax?

  It’s a yearly tax on residential property in certain parts of BC, charged on the home’s assessed value. It was introduced in 2018 to discourage owners from leaving homes empty in regions where housing is tight. The thing to know up front is that most owners owe nothing: if you live in the home, or rent it long-term, you’re generally exempt. But there’s a catch worth its own answer below: even when you’re exempt, you still have to file a declaration every year.
• What are the 2026 rates?

  For Canadian citizens and permanent residents who report most of their income in Canada, the rate is 1% of the assessed value (doubled from 0.5% for the 2026 tax year). For foreign owners the rate is 3%, up by half from 2%, and it rises again to 4% for the 2027 tax year. That 3% also catches untaxed worldwide earners, the Province's term for households that hold property here but report little or no income in Canada. Satellite families are the familiar name for that group. Both rates only apply after exemptions, so a principal residence or a properly tenanted rental typically owes nothing regardless of who owns it. Because the rates changed recently, it’s worth confirming the current figure on gov.bc.ca before relying on it.
• Is there a value below which I don’t pay (the $400,000 figure people mention)?

  Not as an exemption, no, and this is the most common misunderstanding about the tax. The tax is charged on the property’s full assessed value from the first dollar. What produces the $400,000 figure is the credit that comes off afterward. A BC resident who is a Canadian citizen or permanent resident gets a non-refundable credit of up to $4,000 for 2026. And $4,000 is exactly 1% of $400,000. So a sole resident owner’s tax payable lands at zero at an assessed value of $400,000 or less. Above that, they pay 1% of the whole value, less the $4,000. The distinction matters on a second property: at $2.4M the bill is $24,000 minus the credit, not 1% of the amount above some floor.
• Who is exempt, and how do I make sure I qualify?

  The two big exemptions cover most people, and the Province’s own figure is that more than 99% of British Columbians end up exempt. First, your principal residence: the home you actually live in. Second, a long-term rental: a home rented to a tenant for at least six months of the calendar year. Those months are counted in stretches of a month or longer, which is why short-term and vacation rentals don’t help. Beyond those there are more than twenty narrower exemptions. They cover the year you buy, owners who have moved into residential care, homes under construction or renovation, and homes made uninhabitable by something outside the owner’s control. If your home is your residence or a genuine long-term rental, you’re almost certainly in the clear; you just have to declare it.
• Do I really have to file a declaration even if I owe nothing?

  Yes, and this is the single most important line in this guide. If you own residential property in a designated area as an individual, you file a declaration each year, exempt or not. Miss the March 31 deadline and you are assessed at the top 3% rate by default. You lose the resident credit with it, and Budget 2026 also ends the right to appeal an assessment that came from your own declaration that no exemption applies, once it receives royal assent, and adds a $250 late-declaration penalty from January 1, 2027. The Province mails a letter carrying a Letter ID and a Declaration Code, and you need both to file. If the letter has not reached you, contact the Province through the speculation and vacancy tax page.

  Two footnotes. First, "everyone declares" holds for individuals but not for every owner. A small set of entities never file at all: Indigenous Nations and corporations they own, registered charities, housing co-ops, municipalities and regional districts, other public bodies, crown corporations, and agents of government with their wholly owned subsidiaries. Second, filing and paying are different dates. The declaration is due March 31. Payment of any tax assessed is due on the first business day of July: July 2 in 2027 for the 2026 tax year. The Province sends a Notice of Assessment showing what is owed. Declarations are also audited routinely, so an exemption is worth being able to evidence.
• Does the tax apply everywhere in BC?

  No, only in designated "taxable areas," not provincewide. The list has been expanded several times since 2018, and it now reaches well beyond the coast. On the mainland it covers urban Metro Vancouver, Abbotsford, Mission and Chilliwack, Squamish and Lions Bay. Inland it covers most of the Okanagan (Kelowna, West Kelowna, Lake Country, Peachland, Vernon, Coldstream, Penticton and Summerland), plus Kamloops and Salmon Arm. On Vancouver Island it runs from Greater Victoria up the east coast: Duncan, Ladysmith, Nanaimo, Parksville and the Comox Valley. It is set by municipality, not by neighbourhood. A home just outside a covered city may not be caught at all, so check the designated-areas list on gov.bc.ca for a specific address.