BC Speculation and Vacancy Tax Explained (2026: 3% → 2027: 4%)
BC’s speculation and vacancy tax is 1% for citizens and PRs and 3% for foreign owners in 2026, rising to 4% in 2027. Who must declare and who is exempt.
2026 tax year: 1% of assessed value for Canadian citizens and permanent residents who are not exempt, 3% for foreign owners, untaxed worldwide earners and satellite families. 2027 tax year onward: that 3% rises to 4%; the 1% rate stays the same. Applies only in designated regions, mostly Metro Vancouver, the Capital Region, the Fraser Valley, the Central Okanagan, Nanaimo and several communities added since 2023. Every owner in those regions must file a declaration each year, even if exempt.
Figures come from the CostToClose vacant home tax calculator, using the Government of BC schedule. Pick the tax year and your owner/residency category and it applies the right rate automatically.
Rates by tax year
| Owner | 2026 tax year | 2027 tax year onward |
|---|---|---|
| Canadian citizen or permanent resident, not a member of a satellite family | 1% | 1% (unchanged) |
| Foreign owner, untaxed worldwide earner, satellite family | 3% | 4% |
| No declaration filed | Billed at 3% (the 2026 maximum) | Billed at 4% (the 2027 maximum) |
Source: Government of British Columbia, Tax rates for the speculation and vacancy tax (accessed 16 September 2026). The 2027 increase is enacted by the Budget Measures Implementation Act, 2026, which brings the new rate into force 1 January 2027; it applies to tax liabilities based on 2027 calendar-year property use, not to 2026-or-earlier declarations filed after that date.
A "satellite family" is one where more than half of worldwide household income is not reported on a Canadian tax return. The tax credit available to BC residents was $4,000 for 2026, which offsets the tax on the first $400,000 of value for a BC resident who is otherwise taxable. Check the current year's credit amount before relying on it for 2027, since it can change.
What's changing in 2027
This is the second consecutive annual increase to the top rate: it went from 2% to 3% for 2026, and now from 3% to 4% for 2027. Only the highest-rate tier moves: foreign owners, untaxed worldwide earners, and satellite families. The 1% rate for qualifying Canadian citizens and permanent residents has not changed. The higher rate applies to a property owner's use of the residence during the 2027 calendar year; it does not reach back to affect anything declared for 2026 or earlier, even if that declaration is filed in 2027. Don't bother skipping the paperwork to dodge it, either. If you fall in the highest-rate category and don't file a declaration at all, the province still assesses you at that year's top rate, 4% once 2027 arrives. See Latest Updates for exactly when we checked this and what we changed because of it.
Where it applies
Metro Vancouver, the Capital Regional District (excluding the Gulf Islands and Juan de Fuca), Abbotsford, Chilliwack, Mission, Kelowna, West Kelowna, Nanaimo, Lantzville, and the areas added since 2023 including Squamish, Lions Bay, North Cowichan, Duncan, Ladysmith, Lake Cowichan, Vernon, Coldstream, Penticton, Summerland, Peachland, Kamloops, Salmon Arm, Courtenay, Comox, Cumberland, Parksville and Qualicum Beach. Check the province's current list before assuming a property is outside.
Who is exempt
The large majority of owners. The main exemptions:
- The property is your principal residence.
- It is rented to a tenant for at least six months of the year (one-month minimum tenancy periods).
- You bought or inherited it during the year.
- It is under construction or renovation, or uninhabitable.
- Separation, death of an owner, medical care away from home, and several other life-event exemptions, most for a limited number of years.
Exempt or not, you must declare by 31 March each year. Miss the declaration and the province assesses the full tax and sends a bill; it can be reversed by filing late, but only within a window.
Worked example from the calculator
A $1.2 million Kelowna house owned by a family living in Alberta, used as a summer home, not rented:
| Owner status | 2026 tax year | 2027 tax year onward |
|---|---|---|
| Canadian citizens, no BC income | $12,000 (1%) | $12,000 (1%, unchanged) |
| If they instead rented it for 6+ months a year | $0 | $0 |
| Same property, foreign owner | $36,000 (3%) | $48,000 (4%) |
Reproduce the 2026 figures · reproduce the 2027 foreign-owner figure.
How it differs from Vancouver's empty homes tax
Vancouver also charges its own empty homes tax (3% of assessed value) on properties within city limits that are vacant more than six months and not exempt. A vacant Vancouver home can owe both; the exemptions are similar but the declarations are separate, with different deadlines.
What changes the number
- Renting it out for six months or more removes the tax entirely.
- Where you file taxes. The 1% vs 3%-or-4% distinction depends on residency and where worldwide income is reported, not citizenship alone.
- Which tax year applies. The rate is set by the year the property use is being declared for (3% for 2026, 4% for 2027 onward), not the year you happen to file the paperwork.
- Assessed value, from BC Assessment, not purchase price.
- The tax credit, up to $4,000 for BC residents, which can zero out the tax on a modest second property.
Frequently asked questions
What is the speculation and vacancy tax rate in BC for 2026?
1% of assessed value for Canadian citizens and permanent residents, 3% for foreign owners, untaxed worldwide earners and satellite families. Both doubled from 2025's 0.5% and 2%.
Is the BC speculation and vacancy tax going up in 2027?
Yes, for the highest-rate group only. From the 2027 tax year onward the 3% rate rises to 4%; the 1% rate is unchanged. It does not apply early — 2026 declarations still use 3%/1%. Enacted by the Budget Measures Implementation Act, 2026, in force 1 January 2027.
What happens if I don't file my declaration?
The province bills you at that year's highest rate by default — 3% for 2026, 4% for 2027 onward — even if you'd otherwise qualify for 1% or an exemption.
Do I have to declare if I live in my home?
Yes, if it is in a designated region. The declaration is annual and due 31 March; living in the home makes you exempt, but only if you declare.
Is the speculation tax the same as Vancouver's empty homes tax?
No. They are separate taxes with separate declarations. A vacant home in Vancouver can be subject to both.
Can I avoid the tax by renting to a family member?
Yes, if there is a genuine tenancy of at least six months in the year. Arm's-length rules apply for non-BC-resident owners; check the current tenancy exemption criteria.
Does the tax apply to a cottage on the Gulf Islands or in Whistler?
The Gulf Islands and Whistler are currently outside the designated regions. Squamish and several other communities were added in 2023–2024, so confirm against the province's list.
Sources
- Government of British Columbia, Tax rates for the speculation and vacancy tax (2026 and 2027-onward rates) — checked 16 Sept 2026
- Government of British Columbia, Updates to speculation and vacancy tax — checked 16 Sept 2026
- Budget Measures Implementation Act, 2026 (British Columbia) — rate increase to 4% in force 1 January 2027 — checked 16 Sept 2026
- Government of British Columbia, Speculation and Vacancy Tax — exemptions and declaration — checked 14 Sept 2026
- City of Vancouver, Empty Homes Tax — checked 14 Sept 2026
This guide is general information for Canadian home buyers and sellers, checked against the sources listed above on the date shown. It is not legal, tax, or mortgage advice. Rules and rates change; confirm current figures with your lawyer or notary, your lender, or the government office that administers the tax before relying on them.