2024 Provincial Budget Highlights

On February 22, 2024, BC’s Ministry of Finance released the Province’s 2024 Budget. A summary of the key BC Budget highlights is provided below.

Housing Measures

Housing related measures announced in the Budget include the following:

Tax Targeting Home Flipping

The Government will introduce legislation in the Spring of 2024 to impose a new tax on income from the sale of residential real estate in BC. The tax rate will be 20% for properties sold within 365 days of purchase and will be gradually reduced to nil for properties sold between 366 and 730 days. This tax will apply in addition to any federal or provincial income taxes incurred from the sale of the property.

This new tax will apply to income from the sale of properties with a housing unit, properties zoned for residential use, as well income from the assignment of contracts to purchase these properties.  The tax will not apply to land or portions of land used for non-residential purposes.

An individual who sells their primary residence within two years of purchase will be able to exclude a maximum of $20,000 when calculating their taxable income.

Exemptions will be provided for those who add to the housing supply or engage in construction and real estate development. Further, an exemption to the tax will apply for certain life circumstances that may motivate the sale of property within two years, including separation or divorce, death, disability or illness, work relocation, involuntary job loss, change in household membership, personal safety, or insolvency.

This tax will apply to properties sold on or after January 1, 2025, including those purchased before this date.

Exemption for New Purpose-Built Rental Buildings Enhanced

Effective for transactions occurring between January 1, 2025, and December 31, 2030, purchases of new qualifying purpose-built rental buildings will be exempt from the general property transfer tax. Purpose-built rental buildings are buildings that are not stratified and are held as rentals, on a monthly basis or longer, for at least ten years. The residential portion of the building must be used for rental purposes only and must have at least four apartments.

Speculation and Vacancy Tax

Effective January 1, 2024, a person who holds a residential property under a lease registered with the Land Title and Survey of British Columbia will be considered the registered occupier of the property for the purpose of the speculation and vacancy tax, and will be responsible for the tax. Registered leaseholders who are not already required to declare in 2024 will declare for the first time in 2025 based on the use of the property in 2024.

First Time Home Buyers’ Exemption

Effective April 1, 2024, the threshold for the first time home buyers’ exemption is increased from a fair market value of $500,000 to $835,000 with the first $500,000 being exempt from property transfer tax. This exemption begins to phase out at $25,000 above the threshold, with the complete elimination of the exemption at $860,000.

Newly Built Home Exemption

Effective April 1, 2024, the threshold for exemption from property transfer tax on the purchase of a newly built principal residence is increased from a fair market value of $750,000 to $1,100,000. This exemption begins to phase out at $50,000 above the threshold, with the complete elimination of the exemption at $1,150,000 for qualifying newly built homes.

Employer Health Tax

Effective January 1, 2024, the employer health tax exemption and rates will be changed as follows:

Total BC Remuneration (BCR)Prior to 2024Effective 2024 Onwards
$500,000 or lessNilNil
$500,000.01 to $1,000,0002.925% x BCR over $500,000Nil
$1,000,000.01 to $1,500,0002.925% x BCR over $500,0005.85% x BCR over $1,000,000
Over $1,500,0001.95% x total BCR1.95% x total BCR

Provincial Sales Tax Measures (“PST”)

PST related measures announced in the Budget include the following:

  • Effective July 1, 2024, the availability of PST refunds is reduced where a person acts as though they are the end purchaser of goods, but they are actually acquiring the goods for export and resale outside of British Columbia.
  • Effective on royal assent, a PST refund will be available to a person who purchases goods from a seller who did not collect PST, when the purchaser self-assesses PST but then returns the goods for a refund.

Mandatory Electronic Payment

Payments over $10,000 to the Receiver General for Canada made after 2023 must be made electronically.

Other Tax Measures

  • Effective February 23, 2024, oil and gas exploration expenditures will no longer qualify for the mining exploration tax credit.
  • Effective June 1, 2024, the regional and distant location tax credits are amended to exclude animation productions from eligibility.
  • Effective September 1, 2024, gambling with currency is added to the list of ineligible products for the Interactive Digital Media Tax Credit.
  • Effective on royal assent, farmers are exempt from insurance premium tax on premiums paid for provincial agricultural insurance programs offered by the Ministry of Agriculture and Food.
  • Effective on royal assent, the clean building tax credit deadline is extended by six months to September 30 2027.
  • Effective for the 2025 tax year, the Province will no longer impose property taxes on Nisga’a Lands or the Treaty Lands of a Modern Treaty Nation, allowing Modern Treaty Nations to self-determine property taxes on their respective treaty lands.
  • Effective July 1, 2024, the maximum annual Climate Action Tax Credit will be increased from $447 to $504 for an adult, from $223.50 to $252 for a spouse or common-law partner, and from $111.50 to $126 per child.
  • The training tax credit for employers will be extended for three years to the end of 2027 and will be extended for one year for individuals to the end of 2025.
  • The shipbuilding and ship repair industry tax credit is extended for two years to the end of 2026.