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This is a new opportunity with a short window under an economic stimulus package announced last spring.  It addresses vacation properties, which have been excluded from the GST/HST rebates that are available to both principal residences and rentals.  The grant for vacation properties came into effect on April 1, 2012 and is worth up to $42,500.

This is a grant program versus a rebate program and so the conditions are not all identical to the GST/HST rebates that we are accustomed to although it appears to be a parallel program.  The applications for the grant are submitted directly to the province whereas the rebate applications are all administered by the Canada Revenue Agency.  Applications must be received within six months and prior to October 1, 2013 whereas applications under the rebate program are not due until two years following completion.  Housing must be outside of the Capital Regional District (Greater Victoria) and the Greater Vancouver Regional District.  Locations such as Mount Washington, Whistler, and Lake Cowichan will qualify.  The housing may not be used to earn income; for example, vacation rentals, home businesses, bed and breakfast.

The grant is calculated as 71.43% of the provincial component of HST.  Effectively, this is a 5% piece of the 12% HST sales tax.  For example, if your construction costs are $100,000, then HST would be $12,000 and you would apply for this grant which would return you $5,000 (5% of $100,000 or 71.43% of 7% of $100,000).

For more information on this grant or for assistance with your application, please call us to schedule an appointment.

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The information contained in this article is for general use only and should not be viewed as professional advice. Accounting and tax rules and regulations regularly change and individuals should contact a competent professional to obtain accounting and tax advice based on their specific situation.

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