BC Vacation Rentals - Taxation Issues

[peterwardell]

Hi There,

I`m in the process of closing on a condo in Squamish, BC and am undecided on renting unfurnished, long term or renting out on a vacation/executive, short term basis.

My concern with renting it out as a vacation property (weekly or weekend rates) is that I have heard something about BC law taxing this type of income at a higher rate.

Does anyone have any info on this area or any links to websites??

In advance, many thanks

PETE WARDELL BCOM BPHED
CONSULTANT
PROJECT MANAGER - EVOLVE OPPORTUNITY FUND LP

 

[Thomas Beyer]

BC has a commercial/tourist zoning .. as has AB. If this property is in that zone then taxes are about triple of a residential.

In residential they have 3 tax classes:
a) senior - lowest
b) owner occupied .. about 50% higher
c) investor i.e. rented .. about 2x as high as senior

So you could be in the first group of commercial or the group c) .. check the zoning of the property .. and if they allow weekly rentals then I bet you will be assessed "commercial" taxes !!

Weekend rental might not be allowed (albeit frequently being abused) !! So check what you can and cannot do in that condo complex before you waive conditions !

Sometimes it varies by floor .. so floor 1 and 2 might be short-term rental is allowed, i.e. commercial .. and floor 3 and 4 residential !

make this investigation part of your due diligence !