As you may have heard, British Columbia is going back to paying Provincial Sales Tax (PST) instead of the current Harmonized Sales Tax (HST) on April 1, 2013. In the interim, for the period April 1, 2012 to April 1, 2013, the province has announced transitional rules for the purchase of new homes and the rebates associated with the taxes.
If you are purchasing as your PRIMARY residence, priced up to $850,000:
- A new home with land
- A new home with leashed land
- A new float or mobile home
- A new cooperative housing
- A new home constructed or 90% renovated by an owner builder
Or if you're buying a secondary vacation home outside the Greater Vancouver and Capital Regional Districts priced up to $850,000
You will be eligible for a rebate of 71.43% rebate up to a maximum of $42,500 up from the current $26,250 maximum rebate.
Here's how the rules apply:
If you are taking possession of your new property before April 1, 2013, you will pay the 12% HST and be eligible for a rebate of up to $42,500.
If you are taking possession of your new property AFTER April 1, 2013, you will NOT pay the 7% portion of the tax, instead you will pay a 2% transitional tax.
If you purchase your home after April 1, 2013, then the old GST will apply to the purchase of your new home.