British Columbia transition tax rules for grandparented taxable sales of new housing

Under the transitional rules for implementing the HST in British Columbia, certain sales of single-unit housing and residential condominiums were grandparented (that is, they were not subject to the HST) where the written agreement of purchase and sale was entered into before November 19, 2009. If ownership and possession of such new housing transfer on or after April 1, 2013, the sale of the new housing is subject to the GST at the rate of 5% and the 2% British Columbia transition tax, but is not subject to the 12% HST.

Where the British Columbia transition tax applies to a grandparented taxable sale of new housing, the consideration for the housing is considered to include the British Columbia transition tax, calculated as 2/102 of the consideration.  That means that the purchaser does not pay an additional amount on account of the British Columbia transition tax.

The tax is still considered to have been paid by the purchaser and the builder is considered to have collected the tax from the purchaser at the time the GST becomes payable on the sale. The builder must report and remit the British Columbia transition tax that is deemed to have been collected.

Forms and publications

• 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-157, Elimination of the Harmonized Sales Tax in British Columbia: British Columbia Transition Rebate for Builders of New Housing

Date modified:

2014-11-07