Tax Measures Under Canada’s COVID-19 Economic Response Plan

Measures for business

  • Effective as of the March 23, 2020, announcement date, the filing and payment deadlines for the following provincial taxes will be deferred until September 30, 2020:
  • employer health tax;
  • PST, including self-assessing PST registrants;
  • municipal and regional district tax on short-term accommodation;
  • tobacco tax;
  • motor fuel tax; and
  • carbon tax.
  • The following tax measures announced in the February 18, 2020, British Columbia budget have been postponed until April 1, 2021:
  • the scheduled April 1 increase to the provincial carbon tax;
  • the new PST registration requirements for foreign sellers of software and telecommunication services; and
  • the implementation of PST on sweetened carbonated drinks.
  • In an April 1, 2020, Tax Notice[87], revised on April 22, 2020, the Government of British Columbia announced changes to its sales tax. PST registrants must continue to include sales tax on invoices and collect from customers. Registrants may temporarily close their PST accounts if business operations have ceased. To close a PST account, registrants must submit a closure request online via eTaxBC[88], or submit a Request to Close Provincial Sales Tax Account (FIN 357[89]).
  • Any corporation who has a B.C. logging tax return[90] due between the periods of March 18 to August 31, 2020, now has until September 1, 2020 to submit.
  • Taxpayers do not have to pay Exit Tax[91] to the Insurance Corporation of British Columbia, effective May 4, 2020, if the vehicle was purchased before May 4, 2020, and if the prorate license is cancelled and replaced with a licence for use solely within British Columbia between March 11, 2020, and September 30, 2020.
  • The Government of British Columbia originally announced a 50% reduction in school tax rates for commercial properties (Classes 4, 5 and 6) for the 2020 tax year. On April 16[92], 2020, the province announced an additional reduction to an average 25% reduction in the total property tax bill for most businesses. The date on which late payment penalties will apply for commercial buildings (Classes 4, 5, 6, 7 and 8) is postponed to October 1, 2020.
  • The deadline, after which late payment penalties on property tax would apply for commercial buildings (Classes 4, 5, 6, 7 and 8) in rural areas, is postponed to November 3, 2020.
  • Most debt collection activities were suspended until September 30, 2020. Most collection activities resumed on October 1, 2020[93]. Provincial staff are available to assist taxpayers to arrange flexible payment options.
  • From March 24 to September 30, 2020, interest was not charged on outstanding amounts of most provincial taxes and royalties. Interest will be charged again effective October 1, 2020.
  • WorkSafeBC[94] is postponing the payment deadline for the first quarter of 2020 to June 30, 2020, for employers who report payroll and make payments on a quarterly basis. Employers who report payroll on an annual basis have until March 2021, to report their 2020 payroll or pay their 2020 premiums.
  • Employers required to make instalment payments on their Employer Health Tax[95] for the 2020 calendar year will be able to defer these payments. The instalments will be due on the following dates: first instalment on December 31, 2020, second instalment on January 31, 2020, and third instalment on February 28, 2021. The remaining tax payable is due with the employer health tax return by March 31, 2021.
  • On September 17, the government announced a temporary PST program[96] where corporations may apply to receive an amount equal to the PST they paid between September 17, 2020, and September 30, 2021, on qualifying machinery and equipment. To be eligible for the rebate, the eligible property must be obtained substantially (more than 90%) for the purpose of gaining or producing income. Online applications open on April 1, 2021.
  • The C. Increased Employment Incentive[97] is a refundable tax credit for employers who increase their B.C. remuneration by creating new jobs or increasing the pay of their existing low-or medium-income employees over October to December of 2020. Those employers may claim a tax credit equal to 15% of the amount that the employer’s qualifying B.C. remuneration exceeds the employer’s base B.C. remuneration. The qualifying B.C. remuneration is the total B.C. remuneration paid to employees over the last quarter of 2020, with a maximum weekly B.C. remuneration for each eligible employee of $1,129.33. The base B.C. remuneration is the total B.C. remuneration paid to eligible employees for the third quarter of 2020, with a maximum weekly B.C. remuneration for each eligible employee of $1,129.33.
  • On October 9, 2020, the Government announced a new Small and Medium-Sized Business Recovery Grant program. The program will provide assistance to businesses that experienced a 70% revenue loss during March and April 2020, and continue to earn less than 50% of their pre-COVID revenue. Those eligible B.C. businesses will receive a one-time, non-recoupable grant of between $10,000 and $30,000, depending on their pre-COVID revenue. To be eligible, the business must meet certain criteria listed here[98]. Eligible businesses may apply for grants immediately. Grants are available until March 31, 2021, or until the reserved funds (up to $300 million in aggregate) are fully distributed.

Measures for individuals

  • A B.C. Emergency Benefit for Workers provides a one-time, tax-free $1,000 payment to residents of British Columbia. Residents of B.C. who receive federal EI or the CERB are eligible.
  • Eligible British Columbia residents will receive a one-time enhanced payment of the B.C. Climate Action Tax Credit[99] in July 2020 along with their federal GST/HST credit payments:
  • an adult will receive up to $218.00 (increased from $43.50);
  • a child will receive $64.00 (increased from $12.75); and
  • a family of four will receive up to $564.00 (increased from $112.50).

Additionally, the Federal government will continue to pay benefits for an additional three months to those who are not able to file their 2019 income tax returns on time, and this will also apply to the enhanced B.C. climate action tax credit for July 2020.

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