Grandparented sales of new housing in British Columbia

As of April 1, 2013, the HST at the rate of 12% no longer applies in British Columbia. The HST has been replaced by the GST at the rate of 5% and a provincial sales tax.

The HST at 12% generally applied to taxable sales of housing in British Columbia where both ownership and possession were transferred after June 2010 and the tax became payable before April 2013, unless the sale was grandparented. GST at 5% applies to grandparented sales.

The grandparenting rule generally applies where a written agreement of purchase and sale for a newly constructed or substantially renovated detached house, semi-detached house, attached house, residential condominium unit, or condominium complex was entered into before November 19, 2009, and both ownership and possession were transferred to the purchaser under the purchase and sale agreement after June 2010.

In the case of a detached house, semi-detached house, or attached house, the purchaser must be an individual for the sale to be grandparented. In the case of residential condominiums, the grandparenting rule applies to all purchasers, including individuals.

Grandparenting does not apply to:

• owner-built homes; and
• duplexes, traditional apartment buildings, mobile homes, modular homes, and floating homes.

Assignment of purchase and sale agreements for grandparented housing

Where a written agreement of purchase and sale for grandparented housing is assigned to another person (assignee), the housing will remain grandparented if the assignee receives ownership and possession of the grandparented housing under the agreement with the original builder after June 2010 and:

• there is no novation of the agreement;
• the purchaser and the original builder are dealing at arm's length and are not associated for GST/HST purposes;
• the original builder does not reacquire by way of sale any legal or beneficial interest in the housing; and
• a person who is not dealing at arm's length (aunts and uncles will be considered to be related to their nieces and nephews) with, or who is associated with, the original builder does not acquire by way of sale any legal or beneficial interest in the housing.

Special rules apply to sales of certain new housing where the tax on the sale or self-supply became payable after March 2013, referred to under the BC transition tax rules for grandparented taxable sales of new housing.

Forms and publications

• GST/HST NOTICE246, Harmonized Sales Tax for British Columbia - Questions and Answers on Housing Rebates and Transitional Rules for Housing and Other Real Property Situated in British Columbia
• GST/HST NOTICE276, Elimination of the HST in British Columbia in 2013 - Transitional Rules for Real Property Including New Housing
• GST/HST Info Sheet GI-098, Harmonized Sales Tax: Resales of New Housing in Ontario and British Columbia
• GST/HST Info Sheet GI-157, Elimination of the Harmonized Sales Tax in British Columbia: British Columbia Transition Rebate for Builders of New Housing

Date modified:

2014-11-07