Beginning April 1, 2013, the 12% harmonized sales tax (HST) will no longer apply on property or services made in British Columbia (B.C.), or to property or services imported or brought into B.C. that are not zero-rated supplies. In its place, the 5% goods and services tax (GST) will apply to these products and importations.
What this means for you:
- You will pay the 5% GST on purchases of taxable goods, intangible property (such as rights), and services, if either of the following applies:
- the tax becomes payable after March 31, 2013, without having been paid before April 1, 2013; or
- the tax is paid after March 31, 2013, without having become payable before April 1, 2013.
- If the tax becomes payable or is paid before April 1, 2013, the 12% HST will apply.
- All GST/HST registrants will need to update their accounting and point-of-sale systems by April 1, 2013, to accommodate the change in rate.
- As a result of the return to GST in BC, there will be changes to the rebates for housing, and public service bodies such as charities, qualifying non-profit organizations, etc.
Sales of newly constructed or substantially renovated housing:
- The B.C. new housing rebates and B.C. new residential rental property rebates, which are administered by the Canada Revenue Agency (CRA), will not be available for new housing purchases on which the GST becomes payable on or after April 1, 2013.
- The B.C. transition tax (a temporary provincial tax for new housing) will generally be payable by purchasers of new housing if the GST becomes payable on the purchase on or after April 1, 2013, and before April 1, 2015, and the construction or substantial renovation of the housing was at least 10% completed before April 1, 2013. The transition tax will generally be equal to 2% of the purchase price.
- Builders of new housing may be eligible for the B.C. transition rebate (a temporary provincial rebate for new housing) if the sale of the housing is subject to the B.C. transition tax.
- The B.C. transition tax and B.C. transition rebate will apply until April 1, 2015, and will be administered by the CRA. Generally, the B.C. transition rebate must be filed within two years of the due date of the return on which you are required to report the transition tax.
Where to get more information:
The CRA will keep you informed as more information becomes available. For the most up-to-date information, go to www.cra.gc.ca/gstinbc or subscribe to Excise and GST/HST News at www.cra.gc.ca/lists to receive quarterly electronic newsletters.
The CRA’s online services for businesses:
Did you know that you can simplify your GST/HST filing obligations by using the CRA’s online filing options? For more information, go to www.cra.gc.ca/gsthst-filing. To learn more about the online services offered through the CRA’s My Business Account , go towww.cra.gc.ca/mybusinessaccount.