File & Pay Your Taxes
When you engage in liquefaction activities at an LNG facility in B.C., you must file an LNG income tax return and pay any LNG income tax you owe. You must file a return for each facility where you engage in liquefaction activities, even if you don’t owe any LNG income tax for that taxation year.
A partnership return must be filed for each partnership engaged in liquefaction activities at an LNG facility in B.C.; however, each partner is responsible for filing a tax return and paying any tax owing.
You don’t need to file an LNG income tax return if you are exempt from the LNG income tax, unless we ask you to. Exempt entities include the federal government, local governments, and public bodies performing a function of government in Canada. Trusts are also exempt if every beneficiary of the trust is exempt.
If you owed more than $100,000 in LNG income tax in the previous taxation year, you must make quarterly instalment payments in the current taxation year. An instalment payment is a partial payment of the total amount of tax payable for the year.
Your quarterly instalment payment must be equal to at least 25% of the lesser of:
- the previous year’s tax
- the current year’s estimated tax
If you choose to pay instalments based on 25% of the current year’s estimated tax, and the instalments are less than 25% of either the actual tax or the previous year’s tax, interest will be charged.
Instalment payments are due on the last day of every complete quarter of a taxation year.
Any remaining tax payable is due with your LNG income tax return.
Your LNG income tax return is due within six months after the end of your taxation year. For example, if your year end is December 31, your LNG income tax return must be filed no later than June 30 of the following year.
If the due date falls on a Saturday, Sunday or statutory holiday, the due date is the next business day.
You may be charged penalties and interest if you file your return after the due date.
Any balance owing after all your instalment payments are made is due when your return is due. Interest applies to any amount still owing after the due date.
A separate partnership return must be filed for the partnership for each LNG facility in respect of which the partnership engaged in liquefaction activities.
This return determines the partnership’s income or loss from business or property, income from another source, specific deductions in certain circumstances, capital investment account balances, adjusted capital investment account balance, and any eligible closure expenditures for the LNG facility.
Only one member of the partnership needs to file the partnership return on behalf of all members.
The partnership return must be filed within five months from the end of the partnership’s fiscal period.
How to File
More information will be available about filing an LNG income tax return or partnership return and paying LNG income tax after the tax comes into effect in 2017.