Provincial Sales Tax Act, Part 3 - Taxes in Relation to Tangible Personal Property

Last updated on September 11, 2024

Division 1 — Rates of Tax

Section 34 – Rates of Tax in Relation to Purchase Price

PST - SEC.34/Int.

References:

Act: Section 1 "boat", "Excise Tax Act", "manufactured building", "manufactured mobile home", "manufactured modular home", "original purchase price", "passenger vehicle", "portable building" "purchase price", "vehicle"; Section 37; Section 49; Section 50; Section 51; Section 52; Sections 80-86; Section 103

Small Business Guide to PST

Interpretation (Issued: 2013/11; Revised: 2014/09; 2021/12)

Effective January 1, 2020, Bill 45, Taxation Statutes Amendment Act, 2019 amended section 34 to add subsection 34(11) which provides that the PST rate on vapour products is 20% of the purchase price of the vapour product.

Effective April 1, 2018, Bill 2, Budget Measures Implementation Act, 2018 amended section 34 to provide for additional PST rates on sales of passenger vehicles with an original purchase price of $125,000 or more. For passenger vehicles with an original purchase price of $125,000 - $149,999.99 the rate increased to 15%, and to 20% for those with an original purchase price of $150,000 and over.

For purchases that the new PST rates apply to, the PST amount may be included in the consideration for purposes of calculating the goods and services tax (GST). For additional information relating to GST, contact the Canada Revenue Agency.

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 added the reference of subsection 51(6) to subsections 34(1), (3), (5) and (8.1). The amendments are consequential to the concurrent amendments to subsection 51(6) [total amount of tax payable].

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 and Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provide under section 34 the rates of tax in relation to the purchase price of goods, including,

for TPP - 7%
for liquor - 10%
for private sales of vehicles, boats and aircraft - 12%
for sales of vehicles from a dealer - 7% to 10%
on the partial value of manufactured mobile homes, manufactured modular homes and portable buildings - 7%

General tangible personal property

Subsection 34(1) – the general tax rate on TPP under the following sections is 7% of the purchase price of the TPP:

General taxing provision:

section 37 [tax on purchase]

Bringing in to British Columbia:

paragraph 49(6)(a) [tax if tangible personal property brought into British Columbia for use]
paragraph 51(6) [tax if tangible personal property brought into British Columbia for temporary use]
section 52 [tax if tangible personal property brought into British Columbia by non-residents]

TPP used to improve real property:

section 80 [tax on tangible personal property used to improve real property if contractor exempt]
section 80.3 [tax on tangible personal property used to improve real property if contractor obtained refund]
section 80.4 [tax if change of use of tangible personal property used to improve real property]
section 80.5 [transitional tax on tangible personal property used by contractor to improve real property]
section 80.6 [transitional tax on tangible personal property used to improve real property]
prior to April 1, 2015, section 80.7 [transitional tax on tangible personal property incorporated into property subject to tax under the New Housing Transition Tax and Rebate Act] (note: section 80.7 has been removed from section 34 on April 1, 2015 by section 160 of Bill 2)

Change in use:

section 81 [tax if change in use of property acquired for resale]
section 82 [tax if property used for new purpose]
section 82.1 [tax on parts or material if property containing parts or material used for new purpose]
section 82.2 [tax if conditions for exemption not maintained for specified period]
section 82.3 [tax if change of use of vehicle, boat or aircraft exempt from tax under Consumption Tax Rebate and Transition Act]
section 83 [tax if change in use of property acquired for lease]
section 84 [tax if change in use of resulting tangible personal property]
section 85 [tax if change in use of prototype]
section 86 [tax if change in use of property for which refund received under taxation agreement]

Liquor

Subsection 34(2) – the tax rate on liquor under sections 37, 49(6)(a), 51(6), 52, 81, 82, 82.2, 84 and 86 is 10% of the purchase price.

Vehicles, boats and aircraft

Subsection 34(3) – the tax rate on a vehicle, boat or aircraft under sections 37, 49(6)(a), 50(2)(a) [tax on registration of vehicle brought into British Columbia], 51(6), 52, 81, 82, 82.2, 82.3, 83, 84, 85 and 86 is 12% of the purchase price unless, as provided under subsection 34(4), the person:

(a) acquired the vehicle, boat or aircraft at a sale in Canada that is a taxable supply by a registrant under Part IX of the Excise Tax Act (i.e., subject to the goods and services tax (GST)),

(b) imported the vehicle, boat or aircraft from outside Canada, or

Generally, the 12% tax rate under subsection 34(3) applies to "private sales" of vehicles, boats and aircraft in the same manner as the "tax on designated property" that was imposed under the Consumption Tax Rebate and Transition Act. As part of the Budget 2012 updates on the status of the re-implementation of the PST, the government announced that the tax on private sales of vehicles, boats and aircraft would continue at a rate of 12% to ensure similar tax treatment between private sales and sales by GST registered businesses.

Subsection 34(4) provides that If one of the criteria listed in paragraphs 34(a), 34(b) or 34(c) are met, then the following tax rates apply:

Subsection 34(5) provides that the tax rate on a non-passenger vehicle, boat or aircraft under sections 37, 49(6)(a), 50(2)(a), 51(6), 52 and 81 to 86 is 7% of the purchase price.

Subsection 34(6) provides that the tax rate on a passenger vehicle under sections 37, 49(6)(a), 50(2)(a), 51(6), 52 and 81 to 86 is:

(a) 7% of the purchase price of the passenger vehicle, if the original purchase price is less than $55,000;

(b) 8% of the purchase price of the passenger vehicle, if the original purchase price is $55,000 to $55,999.99;

(d) 10% of the purchase price of the passenger vehicle, if the original purchase price is $57,000 or more.

Manufactured buildings

Subsection 34(7) provides that the tax rate on a manufactured mobile home under sections 37, 49(6)(a), 51(6), 52, 80, 80.3 to 80.6 (and, prior to April 1, 2015, 80.7) and 82.2 is 7% of the amount equal to 50% of the purchase price of the home.

To simplify, the effective tax rate payable on manufactured mobile homes is 3.5% (i.e., 50% of 7%).

Subsection 34(8) provides that the tax rate on a manufactured modular home under sections 37, 49(6)(a), 51(6), 52, 80, 80.3 to 80.6 (and, prior to April 1, 2015, 80.7) and 82.2 is 7% of the amount equal to 55% of the purchase price of the manufactured modular home.

To simplify, the effective tax rate payable on manufactured modular homes is 3.85% (i.e., 55% of 7%).

Subsection 34(8.1) provides that the tax rate on a portable building under sections 37, 49(6)(a), 51(6), 52, 80, 80.3 to 80.7 and 82.2 is 7% of the amount equal to 45% of the purchase price of the portable building.

To simplify, the effective tax rate payable on portable buildings is 3.15% (i.e., 45% of 7%).

Subsection 34(9) provides that the reduced tax rates provided under subsections 34(7), 34(8) and 34(8.1) do not apply to:

(a) free-standing appliances, free-standing furniture and draperies sold with a manufactured building,

(b) repair parts purchased for a manufactured building, and

Section 35 – Rates of Tax in Relation to Lease Price

PST - SEC.35/Int.-R.1

References:

Act: Section 1 "fair market value", "lease price", "manufactured building", "manufactured mobile home", "manufactured modular home", "modified business vehicle", "modified motor vehicle", "passenger vehicle", "portable building", “vapour product”; Section 39; Section 40; Section 41; Section 42; Section 82.01; Section 102

Bulletin PST 315

Interpretation (Issued: 2013/11; Revised: 2014/09; Revised 2021/11; Revised 2023/03)

Effective January 1, 2020, Bill 45, Taxation Statutes Amendment Act, 2019 amended section 35 to add subsection 35(8) which provides that the rate of tax payable on a lease of a vapour product under section 39 [tax on leases], section 41 [tax if leased property used in British Columbia during rental period] and section 82.01 [tax if leased property used for new purpose] is 20% of the lease price of the vapour product.

Subsection 35(8) was added to support the imposition of 20% tax on vapour products; see PSTA/Sec. 34/Int.

Effective April 1, 2018, Bill 2, Budget Measures Implementation Act, 2018 amended section 35 to provide for additional PST rates on leases of passenger vehicles with a tax rate value of $125,000 or more. For passenger vehicles with a tax rate value of $125,000 - $149,999.99 the rate increased to 15%, and to 20% for those with a tax rate value of $150,000 and over.

For leases that the new PST rates apply to, the PST amount may be included in the consideration for purposes of calculating the GST. For additional information relating to GST, contact the Canada Revenue Agency.

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 added the references of section 41 [tax if leased property used in British Columbia during rental period] and section 82.01 [tax if leased property used for new purpose] to subsections 35(2) to (6). The amendments are consequential to the concurrent amendment to section 41 and addition of section 82.01 to the Act.

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 and Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provide under section 35 the rates of tax in relation to lease price, including:

for leased TPP - 7%
for leased property occasionally supplied with an operator - 7%
for leased passenger vehicles - 7% to 10%
on the partial value of leased manufactured mobile homes, manufactured modular homes and portable buildings - 7%

Subsection 35(1) provides for special rules in determining the "tax rate value" in relation to modified business vehicles, modified motor vehicles, and passenger vehicles.

R.1 Tax Rate Value and Warranties, Service Contracts, and Maintenance Agreements (Issued: 2014/07)

For the purpose of determining the "tax rate value" under subsection 35(1), the cost of any mandatory warranties, service contracts, or maintenance agreements should be included in the fair market value of the vehicle.

The cost of any optional warranties, service contracts, or maintenance agreements should not be included.

Section 36 – Rates Of Tax In Relation To Gifts

PST - SEC.36/Int.

References:

Act: Section 1 "boat", "entry date", "Excise Tax Act", "fair market value", "liquor", "manufactured building", "manufactured mobile home", "manufactured modular home", "passenger vehicle", "portable building", “vapour product”, "vehicle"; Section 49; Section 50

Bulletin PST 312

Interpretation (Issued: 2013/11; Revised: 2014/09; Revised 2021/11; Revised 2023/03)

Effective January 1, 2020, Bill 45, Taxation Statutes Amendment Act, 2019 added subsection 36(11), to provide the rate of tax in relation to gifts of vapour products brought or sent into BC by the person who received the gift is 20%.

Tax is payable on the fair market value of the vapour product on the entry date of the vapour product into BC.

Effective April 1, 2018, Bill 2, Budget Measures Implementation Act, 2018 amended section 36 to provide for additional PST rates on gifts of passenger vehicles brought or sent into BC by the person who received the gift with a fair market value of $125,000 or more. For passenger vehicles with a fair market value of $125,000 - $149,999.99 the rate increased to 15%, and to 20% for those with a fair market value of $150,000 and over.

For gifts that the new PST rates apply to, the PST amount may be included in the consideration for purposes of calculating the federal goods and services tax (GST). For additional information relating to GST, contact the Canada Revenue Agency.

Effective June 23, 2014, Bill 8, Budget Measures Implementation Act, 2014 repealed and replaced subsection 36(4) to provide for a reduced rate of tax in relation to a vehicle, boat or aircraft imported from outside Canada.

The amendment clarifies that imports of vehicles, boats, and aircraft that are subject to GST are subject to PST at the rate of 7% or, for passenger vehicles, 7%-10%.

for TPP - 7%;
for liquor - 10%;
for a vehicle, boat or aircraft gifted by a donor who purchased the item at a private sale - 12%;
for a vehicle, boat or aircraft gifted by a donor who is a GST registrant, or the vehicle, boat or aircraft was imported from outside Canada - 7-10%;
on the partial value of manufactured mobile homes, manufactured modular homes and portable buildings - 7%.

Tax is payable on the fair market value of the good on the entry date of the good into BC.

See section 100 of the Act for the tax rates for vehicles, boats and aircraft gifted within BC. A gift of a vehicle, boat or aircraft within British Columbia is not a sale, lease or taxable entry into the province.

Division 2 — Purchases of Tangible Personal Property

Section 37 – Tax on Purchase

PST - SEC.37/Int.-R.2

References:

Act: Section 1 "collector", "conveyance", "exclusive product", "multijurisdictional vehicle", "reusable container", "vehicle"; Section 28; Section 30; Section 30.1; Section 34; Section 48; Part 3 – Division 5; Section 60; Section 67; Section 69; Section 75; Section 79; Section 80; Section 80.1; Section 80.5; Section 88; Section 89; Section 91; Section 98; Section 101; Section 103; Section 137; Section 147; Section 153; Section 153.1; Section 161; Section 180; Section 182; Section 182.1; Section 182.2; Section 183; Section 192; Section 203; Section 204

PSTERR: Section 24; Section 25; Section 124.2; Section 126.1; Section 142

PSTR: Section 32; Section 79; Section 86; Section 88

Interpretation (Issued: 2013/11; Revised: 2016/01; 2021/12; 2024/08)

Effective July 1, 2024, Bill 3, Budget Measures Implementation Act, 2024 amended subsection 37(3) of Provincial Sales Tax Act by adding “a person who is not a purchaser”. By this amendment sellers are required to collect PST from all buyers (including those who are not purchasers under the Act) that purchase goods for resale regardless of whether the buyer alleges or not that the goods are for resale, unless the buyer provides to the seller their registration number or an exemption certificate.

The change is part of other amendments that are intended to limit the high number of refund claims received by the Ministry from people who act as though they are the end purchaser but are actually resellers. These buyers purchase goods at retail stores in BC, intentionally pay PST to maintain the appearance that they are not resellers, then resell the goods overseas at substantial mark-up. The buyers then apply for refunds of the PST on the basis that the goods were exempt as goods purchased for resale. These buyers do this because retail stores in BC do not want to sell to other resellers and would not otherwise sell goods to these buyers.

Prior to 2021, the Ministry saw these types of transactions related to luxury vehicles. Budget 2021 amended the Provincial Sales Tax Act to limit refunds on resold vehicles (see below interpretation). Since then, the trend shifted to other luxury goods (e.g., smartphones, watches, jewelry) and non-luxury goods (clothes, handbags, etc. bought from retail stores).

Effective October 1, 2021, Bill 4, Budget Measures Implementation Act, 2021 amended section 37 by amending subsection 37(3) and adding two new subsections 37(7) and 37(8).

Subsection 37(3) was amended, consequential to the addition of subsection 37(7), to effectively remove vehicles from the general rule concerning goods purchased from collectors for resale.

The new subsection 37(7) deems a person to be a purchaser of the vehicle bought from a PST collector in British Columbia unless the purchaser provides to the seller their PST registration number, or an exemption certificate.

Paragraph 37(8)(a) excludes registered motor dealers from the deeming rule of subsection 37(7). This ensures that if a registered motor dealer does not provide their PST registration number or exemption certificate to a collector at the time of purchase and pays PST to the collector, they will still be able to apply to the director for a refund of the PST paid. Paragraph 37(8)(b) provides similar relief (to other groups or in specific situations) from the deeming rule of subsection 37(7) in prescribed circumstances (currently there are no prescribed circumstances).

The above amendments intend to address the grey market transactions of luxury vehicles where the people involved with the initial purchases are not open about their intentions. This is because dealerships typically will not sell vehicles to resellers. PST is not payable on goods purchased for resale. However, to maintain the appearance that they are not resellers, purchasers pay the PST to dealerships and try to claim PST refunds from the government.

These statutory amendments are designed to work in concert with the repeal of a refund for vehicles purchased and resold within 7 days.

Effective April 1, 2013, Bill 5, Budget Measures Implementation Act, 2019 amended subsections 37(4), 37(5) and 37(6) to clarify that purchasers of TPP are required to pay tax in circumstances where a collector is required to levy and collect tax if they are unable to collect the information or documentation required to substantiate the exempt status.

Effective April 1, 2013, Bill 13, Finance Statutes Amendment Act, 2015 amended section 37(2)(b). The amendment replaces "conveyance" with "taxable conveyance." The amendment clarifies that the purchasers who are excepted from tax imposed under section 37 (1) include those that are required to pay tax on "taxable conveyances" as defined in section 59, which include both conveyances and parts for those conveyances.

This ensures that parts for a conveyance are not taxed twice - both of their full purchase price and on the prorated formula for conveyances used inside and outside of British Columbia, but only on the prorated formula.

Effective February 19, 2014, Bill 8, Budget Measures Implementation Act, 2014 amended subsection 37(6) to accommodate the addition of the new subsection 80.5(7) [Transitional tax on TPP used by contractor to improve real property] of the Act. The amendment requires a collector to levy and collect tax if a person alleges that the person is exempt under subsection 80.5(7) of the Act, unless the collector obtains the specified information and declarations.

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provide under section 37 the general taxing provision under the Act.

R.1 Production of Advertising Flyers (Issued: 2014/08)

The production of a tangible advertising flyer (i.e. not an electronic flyer) for one customer involves the sale of TPP, even if the publisher also acts as the distributor. PST applies to the purchase price of the flyer.

Where a publisher undertakes to produce and distribute a flyer for several unrelated advertisers with all the distribution costs included, the contract is considered to be the sale of advertising space. The sale of advertising space is not subject to PST. The publisher is required to pay PST on the cost of materials such as paper and ink that become a component of the flyer.

R.2 Items Removed from Hotels (Issued: 2014/08)

Where a customer removes TPP from a hotel, such as a towel or bath robe, and the hotel subsequently charges the customer for the value of the item taken, PST applies to the charge. This is considered to be a sale of TPP to a purchaser because the hotel is agreeing to transfer title to the customer in exchange for the payment.

Division 3 — Leases of Tangible Personal Property

Section 38 – Application Of This Division

PST - SEC.38/Int.

References:

Act: Section 1 "conveyance", "multijurisdictional vehicle"; Section 37; Section 39; Part 3 – Division 6

Interpretation (Issued: 2013/11; Revised: 2014/09)

Effective February 19, 2014, Bill 8, Budget Measures Implementation Act, 2014 amended subsection 38(b) to clarify that Division 3 [leases of tangible personal property] of Part 3 does not apply to vehicles that are multijurisdictional vehicles (MJVs) or vehicles that are to be immediately licensed in BC under a licence to which a prorating agreement applies. The amendment is supported by the concurrent addition of subsection 39(4).

The previous section 38(b) exempted a lease of an MJV from the application of tax, however that exemption did not extend to a new vehicle lease that covers the vehicle for the short period of time before that vehicle becomes licensed as an MJV. In order to mirror the treatment of "purchased" vehicles under section 37(4) of the Act, the amendment clarifies that if a vehicle is to be immediately licensed as an MJV, Division 3 of the Act does not apply to the vehicle.

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 38 that Division 3 [Leases of Tangible Personal Property] of Part 3 [Taxes in Relation to Tangible Personal Property] does not apply to:

(a) a conveyance that is subject to tax or is exempt from tax under Division 6 of Part 3;

(b) subject to subsection 39(2), a multijurisdictional vehicle;

(c) subject to subsection 39(4), a vehicle that is to be immediately licenced in British Columbia as described in subsection 69(1)(a).

Section 39 – Tax On Leases

PST - SEC.39/Int.

References:

Act: Section 1 "lessee", "short term rental vehicle", "vehicle", "vehicle registration legislation"; Section 28; Section 35; Section 39; Section 40; Section 42; Section 43; Section 45; Section 67; Section 69; Section 77; Section 78

Bulletin PST 315

Interpretation (Issued: 2013/11; Revised: 2014/09)

Effective February 19, 2014, Bill 8, Budget Measures Implementation Act, 2014 added a new subsection 39(4), to support the concurrent amendment to subsection 38(b) of the Act.

The amendment to section 39 requires a collector, as lessor, to levy and collect PST, despite an assertion by a person that the leased vehicle is to immediately become a multijurisdictional vehicle (MJV), unless the collector obtains the specified information or declaration from the lessee. The required information is a prorate account number or a Certificate of Exemption - Multijurisdictional Vehicle.

Section 28 [when tax is payable in respect of a purchase or lease] provides for when tax is payable under section 39.

Section 40 – Tax on Motor Vehicle Leased Outside British Columbia and Registered for Use in British Columbia

PST - SEC.40/Int.

References:

Act: Section 1 "fair market value", "lessee", "motor vehicle", "passenger vehicle", "short term rental vehicle", "vehicle", "vehicle registration legislation"; Section 30; Section 41; Section 46

Bulletin PST 116

Interpretation (Issued: 2013/11; Revised 2021/11)

Effective April 1, 2018, Bill 2, Budget Measures Implementation Act, 2018 amended section 40 to provide for additional PST rates on passenger vehicles leased from a person outside British Columbia for more than 28 days, and registered in British Columbia, with a taxable value of $125,000 or more. For passenger vehicles with a taxable value of $125,000 - $149,999.99 the rate increased to 15%, and to 20% for those with a taxable value of $150,000 and over.

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 40 the following taxing provision that applies when a vehicle is leased from a person outside British Columbia for more than 28 days and is registered for use in British Columbia.

Subsection 40(1) provides that in section 40, "taxable value", in relation to a motor vehicle, means the fair market value of the motor vehicle on the date the motor vehicle is registered for use in British Columbia under the vehicle registration legislation.

Subsection 40(2) provides that if a lessee of a motor vehicle leases the motor vehicle for a period of more than 28 days from a person who is located outside British Columbia and registers the motor vehicle for use in British Columbia under the vehicle registration legislation, the lessee must pay to the government tax as follows:

(a) if the motor vehicle is not a passenger vehicle, at the rate of 7% of the taxable value of the motor vehicle;

(b) if the motor vehicle is a passenger vehicle, at the applicable rate as follows:

(i) 7% of the taxable value, if the taxable value of the passenger vehicle is less than $55,000;

(ii) 8% of the taxable value, if the taxable value of the passenger vehicle is $55,000 to $55,999.99;

(iii) 9% of the taxable value, if the taxable value of the passenger vehicle is $56,000 to $56,999.99;

(iv) 10% of the taxable value, if the taxable value of the passenger vehicle is $57,000 or more.

Section 41 – Tax If Leased Property Used In And Outside British Columbia During Rental Period

PST - SEC.41/Int.

References:

Act: Section 1 "BC resident", "lease", "lease price", "lessee", "registrant"; Section 13; Section 35; Section 39; Section 40; Section 45; Section 46; Section 192

PSTR: Section 34; Section 79

Bulletin PST 315

Interpretation (Issued: 2013/11; Revised: 2014/09)

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 amended subsection 41(3) and added a new subsection 41(3.1) to clarify the concept of "rate of tax" in relation to lease price.

Section 42 – Tax If Balance Of Lease Price Becomes Due On Breach Of Lease

PST - SEC.42/Int.

References:

Act: Section 1 "collector", "lessee", "registrant", "taxpayer return"; Section 39; Section 46

PSTR: Section 35; Section 79

Interpretation (Issued: 2013/11)

Subsection 42(1) provides that if a lessee breaches a lease that provides for

(a) the lease of tangible personal property that is subject to tax under section 39 [tax on leases], and

(b) the payment, on breach of the lease, of some or all of the outstanding balance of the lease price,

the lessee must pay to the government tax at the rate of 7% of the amount of the payment referred to in paragraph (b).

Subsection 42(2) provides that tax payable under subsection 42(1) must be paid,

(a) subject to paragraph (b), at the time the payment referred to in paragraph 42(1)(b) becomes due under the terms of the lease, or

(b) if the tax is not levied in accordance with subsection 42(4), on or before the last day of the month after the month in which the payment referred to in subsection 42(1)(b) becomes due under the terms of the lease.

Subsection 42(2.1) provides that despite subsection 42(2), if the tax payable under subsection 42(1) is payable by a registrant and is not levied in accordance with subsection 42(4), the tax must be paid

on or before the prescribed date (as provided under PSTR section 35 [section 42 of Act – tax if balance of lease price becomes due on breach of lease]; see PSTR/Sec. 35/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Subsection 42(3) provides that if a person must pay tax under subsection 42(1) and the tax is payable in accordance with paragraph 42(2)(b), the person must file a taxpayer return with the director.

Subsection 42(4) provides that if the lessor is a collector and the tax under subsection 42(1) is payable in accordance with paragraph 42(2)(a), the lessor must levy and collect the tax at the time the tax is payable in accordance with paragraph 42(2)(a).

Section 43 – Additional Tax On Lease Of Passenger Vehicle

PST - SEC.43/Int.

References:

Act: Section 1 "lessee", "passenger vehicle"; Section 28; Section 39

Bulletin PST 315

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 43 the following taxing provision that imposes an additional passenger vehicle rental tax (PVRT) on leases of passenger vehicles.

Subsection 43(1) provides that in addition to any tax payable under section 39 [tax on leases], a lessee who leases a passenger vehicle must pay to the government, for the raising of revenue for the BC Transportation Financing Authority continued under the Transportation Act, tax at the rate of $1.50 for each day or portion of a day that the lessee leases the vehicle.

Subsection 43(1) provides that the PVRT does not apply if the passenger vehicle that is the subject matter of the lease is leased to the lessee for a period of

(a) 8 consecutive hours or less, or

(b) more than 28 consecutive days.

Section 28 [when tax is payable in respect of a purchase or lease] provides for when tax is payable under section 43.

Section 44 – Exemption If Lease Under Sale And Lease-Back Arrangement

PST - SEC.44/Int.

References:

Act: Section 1 "collector", "Excise Tax Act", "lessee", "lessor"; Section 51; Part 3 – Division 6; Section 147; Section 153; Section 203

PSTERR: Section 57; Section 61

Bulletin PST 315

Interpretation (Issued: 2013/11)

Subsection 44(1) provides that tangible personal property is exempt from tax imposed under Division 3 [Leases of Tangible Personal Property] of Part 3 [Taxes in Relation to Tangible Personal Property] (i.e., the taxing provisions applicable to leases) if

(a) the tangible personal property was sold to the lessor by the lessee under a sale and immediate lease-back arrangement, and

(b) the lessee had, before the sale to the lessor,

(i) paid tax imposed under Part 3 in respect of the tangible personal property, other than tax imposed under section 51 [tax if tangible personal property brought into British Columbia for temporary use] or Division 6 [Conveyances Used Interjurisdictionally], and for which the lessee has not obtained and is not entitled to obtain a refund under the Act,

(ii) paid tax imposed under the Consumption Tax Rebate and Transition Act or the Social Service Tax Act in respect of the tangible personal property and for which the lessee has not obtained and is not entitled to obtain a refund under those Acts, or

(iii) in respect of the tangible personal property, paid tax imposed under section 165(2), 212.1 or 218.1 or Division IV.1 of Part IX of the Excise Tax Act, in respect of British Columbia as a participating province under that Act, and for which the lessee has not obtained and is not entitled to obtain a refund, credit or rebate under Part IX of that Act.

Subsection 44(2) provides that if a collector, as lessor, leases tangible personal property to a person who alleges that the person is exempt under subsection 44(1) from paying tax under Division 3, the collector must nevertheless levy and collect the tax under Division 3 unless the collector obtains from that person, at or before the time the tax is payable,

(a) any information or document required by the regulations (as provided under PSTERR section 61 [evidence relating to exemption under section 44(2) of Act]; see PSTERR/Sec. 61/Int.), and

(b) any information or document required by the director.

Section 45 – Refund For Leased Property Used Outside British Columbia

PST - SEC.45/Int.

References:

Act: Section 1 "lessee", "motor vehicle", "vehicle registration legislation"; Section 13; Section 39; Section 41

Bulletin PST 315; Bulletin PST 400

Interpretation (Issued: 2013/11)

Subsection 45(1) provides that if the director is satisfied that

(a) a lessee of tangible personal property paid tax under section 39 [tax on leases], and

(b) the tangible personal property was used outside British Columbia during a rental period,

the director must pay a refund to the lessee in accordance with subsection 45(2).

Subsection 45(2) provides that the amount of a refund under subsection (1) in respect of a rental period under the lease is equal to the amount of tax paid under section 39 that is in respect of the lease price attributable to the rental period less the amount of tax that would have otherwise been payable under section 41 [tax if leased property used in and outside British Columbia during rental period] in respect of the rental period if that section had applied to the lessee in respect of the rental period.

Subsection 45(3) provides that section 45 does not apply in respect of a lease of a motor vehicle registered for use in British Columbia under the vehicle registration legislation.

Section 46 – Refund On Motor Vehicle Leased Outside British Columbia

PST - SEC.46/Int.

References:

Act: Section 1 "lessee", "motor vehicle"; Section 39; Section 40; Section 41; Section 42

Bulletin PST 315; Bulletin PST 400

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 46 that on termination or expiration of the lease for a motor vehicle referred to in subsection 40(2) [tax on motor vehicle leased outside British Columbia and registered for use in British Columbia] or on removal of the motor vehicle from British Columbia for registration outside British Columbia, the director may provide a refund to the lessee in the amount of the difference between the tax paid under section 40 at the time of registering the vehicle less the sum of all taxes that would have otherwise been payable under section 39 [tax on leases], section 41 [tax if leased property used in and outside British Columbia during rental period] or section 42 [tax if balance of lease price becomes due on breach of lease].

Division 4 — Tangible Personal Property Brought into British Columbia

Section 47 – Definition

PST - SEC.47/Int.

References:

Act: Part 3 – Division 4

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 47 that "calculation year" in Division 4 [Tangible personal Property Brought into British Columbia] of Part 3 [Taxes in Relation to Tangible Personal Property] is defined to mean the following:

(a) the period beginning on the date the property is first brought or sent into, or is delivered in, British Columbia during any year and ending on the day before the first anniversary of that date;

(b) if the property is in British Columbia for a continuous period that is longer than the period referred to in paragraph (a), the period beginning on the day after the immediately preceding calculation year and ending on the day before the first anniversary of that date.

For example, if tangible personal property was brought into British Columbia on April 15th, 2013, the first calculation year under paragraph (a) would be April 15, 2013 to April 14, 2014.

If the tangible personal property remained in British Columbia for a continuous period beyond April 14, 2014, then the second calculation year would be April 15, 2014 to April 14, 2015.

Section 48 – Application Of This Division

PST - SEC.48/Int.

References:

Act: Section 1 "conveyance", "multijurisdictional vehicle"; Section 37; Part 3 – Division 5; Part 3 – Division 6; Section 58; Section 99; Section 101

Interpretation (Issued: 2013/11; Revised: 2016/01)

Effective April 1, 2013, Bill 13, Finance Statutes Amendment Act, 2015 amends section 48(c) by clarifying that the division does not apply to "taxable conveyances" as defined in section 59, which include both conveyances and parts for those conveyances.

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 48 that Division 4 [Tangible personal Property Brought into British Columbia] of Part 3 [Taxes in Relation to Tangible Personal Property] does not apply in relation to the following:

(a) tangible personal property that is subject to tax or is exempt from tax under

section 37 [tax on purchase],
subsection 99(3) or (4) [tax on acquisition of exclusive product by independent sales contractor], or
subsection 101(2) [tax on reusable containers];

(b) tangible personal property, if tax is paid under Division 5 [Property Brought into British Columbia from outside Canada] of Part 3 in respect of the tangible personal property;

(c) a conveyance that is subject to tax or is exempt from tax under Division 6 [Conveyances Used Interjurisdictionally] of Part 3;

(d) a multijurisdictional vehicle.

Section 49 – Tax if Tangible Personal Property Brought into British Columbia for Use

PST - SEC.49/Int.-R.1

References:

Act: Section 1 "BC resident", "collector", "Excise Tax Act", "fair market value", "motor vehicle", "non-resident", "original purchase price", "passenger vehicle", "vehicle"; Section 24; Section 25; Section 28; Section 29; Section 30; Section 34; Section 36; Section 50; Section 51; Section 51.1; Section 52; Section 53; Section 67; Section 75; Section 79; Section 80; Section 80.1; Section 80.5; Section 80.7; Section 80.8; Section 100; Section 147; Section 153; Section 153.1; Section 161; Section 179; Section 203; Section 204

PSTERR: Section 18; Section 19; Section 20; Section 22; Section 23

PSTR: Section 86; Section 88

Interpretation (Issued: 2013/11; Revised: 2014/09; Revised 2021/11)

Effective April 1, 2018, Bill 2, Budget Measures Implementation Act, 2018 amended section 49 to provide for additional PST rates on passenger vehicles brought, received or delivered in British Columbia for use, with an original purchase price of $125,000 or more. For passenger vehicles with an original purchase price of $125,000 - $149,999.99 the rate increased to 15%, and to 20% for those with an original purchase price of $150,000 and over.

For vehicles that the new PST rates apply to, the PST amount may be included in the consideration for purposes of calculating the GST. For additional information relating to GST, contact the Canada Revenue Agency.

Effective February 19, 2014, Bill 8, Budget Measures Implementation Act, 2014 amended subsection 49(12) to accommodate addition of the new subsection 80.5(7) of the Act. The amendment requires a collector to levy and collect tax if a person alleges that the person is exempt under section 80.5(7) of the Act unless the collector obtains the specific information and declarations.

R.1 Exchange Rate (Issued: 2016/06; Revised 2024/08)

To calculate the provincial sales tax (PST) due in Canadian (CAD) funds where the invoice is issued in US dollars (USD), apply the Bank of Canada daily exchange rate for the day the goods entered British Columbia. Daily exchange rates can be found on the Bank of Canada website.

If the taxpayer must pay PST under the temporary use formula under section 51, the exchange rate used should be the rate on the first day the TPP was brought into the province for each time period.

For example, if under the 1/3 formula of the temporary use provisions, the 12-month period for the TPP is January 1, 2023 to December 31, 2023, the 6th day the goods were in BC for temporary use was January 6, 2023, and the first day was January 1, 2023, then the exchange rate used should be the rate on January 1 - the day the TPP was brought into British Columbia. For weekends and holidays, use the nearest previous daily exchange rate.

In the subsequent two 12-month periods, the same rule would apply. The exchange rate used should be the first day the TPP is brought in on each of the subsequent periods.

Section 50 – Tax On Registration Of Vehicle Brought Into British Columbia

PST - SEC.50/Int.

References:

Act: Section 1 "non-resident", "vehicle", "vehicle registration legislation"; Section 25; Section 30; Section 34; Section 36; Section 49; Section 51.1; Section 52; Section 75; Section 153.1

PSTERR: Section 18; Section 19; Section 20; Section 22; Section 57

Bulletin PST 309

Interpretation (Issued: 2013/11; Revised: 2014/09)

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 amended subsection 50(1)(a) to change the tense of the language from present to past tense.

The amendment clarifies, for the imposition of tax at the time of registering a vehicle, that the act of bringing or sending a vehicle into BC need not have occurred on or after April 1, 2013 (the date upon which the provision came into force). By instead referring to a vehicle that has been "brought or sent" into BC, the provision applies in relation to a vehicle that was brought or sent into BC at any time, so long as the registration of the vehicle occurs on or after April 1, 2013.

Generally, a person who does not reside in BC and who does not meet the definition of "non-resident" who registers a travel trailer for use in BC will be subject to tax under section 50 if they did not pay under section 49.

Section 51 – Tax If Tangible Personal Property Brought Into British Columbia For Temporary Use

PST - SEC.51/Int.-R.1

References:

Act: Section 1 "Excise Tax Act", "registrant", "vehicle"; Section 25; Section 34; Section 44; Section 49; Section 50; Section 51.1; Section 53; Section 58; Section 192; Section 238

PSTERR: Section 18; Section 20; Section 23; Section 126; Section 149; Section 150; Section 151; Section 152

PSTR: Section 16; Section 36; Section 79

Bulletin PST 307

Interpretation (Issued: 2013/11; Revised: 2014/09)

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 amended subsection 51(6) to clarify the concept of "rate of tax" in relation to purchase price.

The taxing provision under section 51 is often referred to as the "1/3 formula" and the "1/36 formula".

R.1 Exchange Rate (Issued: 2016/06)

To calculate the provincial sales tax (PST) due in Canadian (CAD) funds where the invoice is issued in US dollars (USD), you should apply the official Bank of Canada (CAD-USD noon rate) exchange rate for the day the goods entered British Columbia. Daily exchange rates can be found on the Bank of Canada website.

If the taxpayer must pay PST under the temporary use formula in section 51, the exchange rate used should be the rate on the first day the TPP was brought into the province for each time period.

For example, if under the 1/3 formula of the temporary use provisions, the 12-month period for the TPP is January 1, 2014 to December 31, 2014, and the 6th day the goods were in BC for temporary use was January 6, 2014, and the first day was January 1, 2014, then the exchange rate used should be the rate on January 1 - the day the TPP was brought into British Columbia.

In the subsequent two 12-month periods, the same rule would apply, that the exchange rate used should be the first day on when the TPP is brought in on each of the subsequent periods.

Section 51.1 – Tax If Tangible Personal Property No Longer For Temporary Use

PST - SEC.51.1/Int.

References:

Act: Section 1 "registrant", "vehicle"; Section 25; Section 47; Section 49; Section 50; Section 51; Section 192

PSTR: Section 16; Section 36; Section 79

Bulletin PST 307

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 51.1.

Section 51.1 provides the change of use taxing provision that applies when tangible personal property that was initially brought into British Columbia for temporary use is no longer being used for temporary use.

Subsection 51.1(1) provides that section 51.1 applies to a person in relation to tangible personal property if

(a) section 51 [tax if tangible personal property brought into British Columbia for temporary use] applied to the person in relation to the tangible personal property, and

(b) within 3 years after the date on which the tangible personal property is first used in British Columbia and during a calculation year in respect of which tax was payable under section 51, the person uses that property, or allows that property to be used, in British Columbia for a purpose other than for temporary use.

Subsection 51.1(2) provides that a person to whom section 51.1 applies must pay to the government tax in an amount equal to the amount of tax under section 49 [tax if tangible personal property brought into British Columbia for use] that would have otherwise been payable if that section had applied to the person in relation to the tangible personal property less the amount of tax paid by the person under section 51 in respect of the tangible personal property.

Subsection 51.1(3) provides that if section 51.1 applies to a person in relation to tangible personal property that is prescribed for the purposes of subsection 25(1) [depreciated purchase price of tangible personal property], the purchase price to be used for the purposes of subsection 51.1(2) in determining the amount of tax under section 49 that would have otherwise been payable in relation to the tangible personal property is to be determined in accordance with subparagraph 25(2)(a)(ii).

Subsection 51.1(4) provides that tax payable under subsection 51.1(2) must be paid on or before the last day of the month after the month in which the person uses that property, or allows that property to be used, for a purpose other than for temporary use.

Subsection 51.1(5) provides that despite subsection 51.1(4), tax payable under subsection 51.1(2) by a registrant must be paid

on or before the prescribed date (as provided under PSTR section 37 [section 51.1 of Act – tax if tangible personal property no longer for temporary use]; see PSTR/Sec. 37/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Section 52 – Tax If Tangible Personal Propery Brought Into British Columbia By Non-Residents

PST - SEC.52/Int.

References:

Act: Section 1 "boat", "non-resident", "vehicle"; Section 25; Section 28; Section 29; Section 30; Section 34; Section 49; Section 50; Section 153.1; Section 179; Section 192

PSTERR: Section 57

Bulletin PST 309

Interpretation (Issued: 2013/11; Revised: 2016/01)

Effective April 1, 2013, Bill 13, Finance Statutes Amendment Act, 2015 amends section 52 by adding a new subsection (4.1). The new subsection mirrors section 49(9) and provides a reduction of tax payable when TPP is brought into British Columbia where the non-resident has already paid one of the specified taxes (e.g., social service tax or provincial sales tax).

Subsection 52(1) provides that, for the purposes of section 52, "travel trailer" means a vehicle designed to be

(a) pulled on a highway, and

(b) used as temporary or seasonal accommodation.

Subsection 52(2) provides that, subject to subsection 52(3), section 52 applies to a non-resident who brings or sends into British Columbia, or who receives delivery of in British Columbia, tangible personal property, if the tangible personal property is, for the year following its entry into British Columbia, to be used or consumed:

(a) primarily in British Columbia, and

(b) primarily by one or more of the following:

(i) the non-resident;

(ii) a person for whom the non-resident acts as agent;

(iii) a person whose use or consumption of the tangible personal property is at the expense of the non-resident;

(iv) a person whose use or consumption of the tangible personal property is at the expense of a principal for whom the non-resident acts as agent.

Subsection 52(3) provides that section 52 does not apply to a non-resident referred to in subsection 52(1) if

(a) the non-resident has leased, as lessee, the tangible personal property, or

(b) the non-resident must pay tax under section 50 [tax on registration of vehicle brought into British Columbia] in respect of the vehicle.

Subsection 52(4) provides that a non-resident to whom section 52 applies must pay to the government tax at the applicable rate under section 34 [rates of tax in relation to purchase price].

Subsection 52(5) provides that a non-resident is exempt from tax imposed under subsection 52(4) if

(a) the non-resident is an individual,

(b) the tangible personal property is a boat or travel trailer, and

Section 28 [when tax is payable in respect of a purchase or lease] provides for when tax is payable under section 52.

Section 53 – Exemption If Less Than Minimum Threshold Use In British Columbia

PST - SEC.53/Int.

References:

Act: Section 47; Section 49; Section 51

PSTR: Section 17

Bulletin PST 307

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 53 that tangible personal property is exempt from tax imposed under section 49 [tax if tangible personal property brought into British Columbia for use] or section 51 [tax if tangible personal property brought into British Columbia for temporary use] if the tangible personal property is in British Columbia during a calculation year for fewer than a prescribed number of days.

Under PSTR section 17 [prescribed number of days for section 53 of Act], the prescribed number of days is:

(a) 41 days for barge-mounted cranes that have a lifting capacity of greater than 100 metric tonnes if those cranes are relieved, under the Vessel Duties Reduction or Removal Regulations (Canada), SOR/90-304, from customs duties, or

(b) 6 days for all other tangible personal property.

Therefore, for all tangible personal property other than the cranes mentioned in PSTR paragraph 17(a), the tangible personal property is exempt from tax imposed under section 49 or section 51 if the tangible personal property is in British Columbia for 5 days or less during a calculation year.

Division 5 — Property Brought into British Columbia from Outside Canada

Section 54 – Application Of This Division

PST - SEC.54/Int.

References:

Act: Section 1 "Excise Tax Act", "motor vehicle", "multijurisdictional vehicle"; Part 3 – Division 5; Section 63; Part 3 – Division 7; Section 191

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 54 the following regarding Division 5 [Property Brought into British Columbia from Outside Canada] of Part 3 [Taxes in Relation to Tangible Personal Property].

Subsection 54(1) provides that Division 5 applies if an agreement entered into under section 191 [agreement with federal government] is in force between the government and the government of Canada or an agent of the government of Canada.

Subsection 54(2) provides that Division 5 does not apply in relation to the following tangible personal property:

(a) tangible personal property that is taxable or exempt from tax under section 63 [tax if conveyance brought into and used in British Columbia] or Division 7 [Multijurisdictional Vehicles];

(b) goods that are for commercial use;

(c.1) all terrain vehicles that are required to be registered under the Motor Vehicle (All Terrain) Act;

(d) tangible personal property that is not subject to tax under Division III of Part IX of the Excise Tax Act because the tangible personal property is a good included in section 1 or 7 of Schedule VII [Non-Taxable Importations] of that Act;

(e) prescribed tangible personal property (currently, nothing is prescribed).

As under the previous PST, the tax is collected at the border by the Canada Border Services Agency or, when goods are delivered by mail, by Canada Post.

Section 55 – Tax if Property Brought into British Columbia from Outside Canada

PST - SEC.55/Int.

References:

Act: Section 1 "customs officer", "Excise Tax Act", "liquor", "manufactured building", "manufactured mobile home", "manufactured modular home", "portable building", "postal agent", "resident taxpayer", “vapour product”; Part 3 – Division 7; Section 80.5; Section 80.7; Section 80.8; Section 90; Section 161

PSTERR: Section 22; Section 126

Bulletin PST 310

Interpretation (Issued: 2013/11; Revised: 2023/03)

Effective January 1, 2020, Bill 45, Taxation Statutes Amendment Act, 2019 amended section 55 to add subsection 55(3.6) which provides that the rate of tax payable under subsection 55(1) and subsection 55(2) on a vapour product is 20% of the taxable value of the vapour product.

Subsection 55(3.6) was added to support the imposition of 20% tax on vapour products; see PSTA/Sec. 34/Int.

Subsection 55(0.1) provides that for the purposes of section 55, "taxable value", in relation to tangible personal property, means the value of the tangible personal property as determined under section 215 of the Excise Tax Act.

Subsection 55(1) provides that unless subsection 55(2) applies, a resident taxpayer who brings tangible personal property into British Columbia from a place outside Canada, or who sends tangible personal property, or enters into an arrangement under which tangible personal property is sent, into British Columbia from a place outside Canada, must, at the time the tangible personal property enters British Columbia,

(a) report the matter to a customs officer,

(b) supply the customs officer with all the information required by the customs officer in respect of the tangible personal property, and

(c) pay to the government, by paying to the customs officer as agent of the government, tax at the applicable rate under subsections 55(3) to 55(3.4).

Subsection 55(2) provides that, subject to subsection 55(4), a resident taxpayer must, at the time of receiving, through a postal agent, tangible personal property in British Columbia from a place outside Canada,

(a) supply to the postal agent all the information required by the postal agent in respect of the tangible personal property, and

(b) pay to the government, by paying the postal agent as agent of the government, the tax at the applicable rate under subsections 55(3) to 55(3.4).

Subsection 55(3) provides that, subject to subsections 55(3.1) to (3.4), the rate of tax payable under subsection 55(1) or subsection 55(2) is 7% of the taxable value of the tangible personal property.

Subsection 55(3.1) provides that the rate of tax payable under subsection 55(1) or subsection 55(2) on liquor is 10% of the taxable value of the liquor.

Subsection 55(3.2) provides that the rate of tax payable under subsection 55(1) or subsection 55(2) on a manufactured mobile home is 7% of the amount equal to 50% of the taxable value of the manufactured mobile home.

Subsection 55(3.3) provides that the rate of tax payable under subsection 55(1) or subsection 55(2) on a manufactured modular home is 7% of the amount equal to 55% of the taxable value of the manufactured modular home.

Subsection 55(3.4) provides that the rate of tax payable under subsection 55(1) or subsection 55(2) on a portable building is 7% of the amount equal to 45% of the taxable value of the portable building.

Subsection 55(3.5) provides that subsections 55(3.2) to 55(3.4) do not apply to the following:

(a) free-standing appliances, free standing furniture and draperies sold with a manufactured building;

(b) repair parts purchased for a manufactured building.

Subsection 55(4) provides that subsection 55(2) does not apply unless there is an agreement in force between the Canada Post Corporation and the government of Canada or an agent of the government of Canada providing for the collection of tax under Division 5 [Property Brought into British Columbia from Outside Canada] of Part 3 [Taxes in Relation to Tangible Personal Property] by that corporation.

Section 56 – Detention Of Tangible Personal Property

PST - SEC.56/Int.

References:

Act: Section 1 "collection agent", "resident taxpayer"; Section 55

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 56 how tangible personal property must be dealt with by a collection agent if a resident taxpayer does not comply with section 55 [tax if tangible personal property brought into British Columbia from outside Canada].

Subsection 56(1) provides that if a resident taxpayer does not comply with section 55, a collection agent may detain the tangible personal property.

Subsection 56(2) provides that the tangible personal property detained under subsection 56(1) must be dealt with as follows:

(a) returned to the resident taxpayer if, within 60 days after the date of detention, the tax that was payable at the time of its detention and any expenses related to the detention of the tangible personal property are paid and the requirements of paragraph 55(1)(b) or paragraph 55(2)(a) are met;

(b) forfeited to the provincial government if, within 60 days after the date of detention, the tax that was payable at the time of its detention and any expenses related to the detention of the tangible personal property are not paid or the requirements of paragraph 55(1)(b) or paragraph 55(2)(a) are not met within that period. The forfeited tangible personal property may be disposed of as directed by the director.

Section 57 – Tax Payable To Collection Agent Even Though Exemption Claimed

PST - SEC.57/Int.

References:

Act: Section 1 "collection agent", "resident taxpayer"; Part 6; Section 191; Section 211

Bulletin PST 310

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 57 the rules that apply if a resident taxpayer alleges that tangible personal property is exempt under Part 6 [Exemptions] or under the regulations from tax imposed under Division 5 [Property Brought into British Columbia from Outside Canada] of Part 3 [Taxes in Relation to Tangible Personal Property].

Subsection 57(1) provides that that if a resident taxpayer alleges that tangible personal property is exempt under Part 6 or under the regulations from tax imposed under Division 5 of Part 3, the collection agent, in the circumstances as specified in the agreement between the provincial and federal governments entered into under section 191 [agreement with federal government], may nevertheless require that the resident taxpayer pay the tax.

Subsection 57(2) provides that if the collection agent requires payment of the tax under subsection 57(1), the resident taxpayer

(a) must pay the tax to the collection agent, and

(b) may apply to the government of Canada or an agent of the government of Canada for a refund under paragraph 191(6)(b) of the tax paid in respect of that tangible personal property.

Section 58 – Refund If Property Brought Into British Columbia For Temporary Use

PST - SEC.58/Int.

References:

Act: Section 1 "resident taxpayer"; Section 48; Section 51; Section 55

Bulletin PST 310; Bulletin PST 400

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 58 that if the director is satisfied that

(a) a resident taxpayer paid tax under section 55 [tax if property brought into British Columbia from outside Canada] in relation to tangible personal property, and

(b) but for paragraph 48(b) [application of Division 4], the resident taxpayer would have paid tax under section 51 [tax if tangible personal property brought into British Columbia for temporary use] in relation to the tangible personal property

the director must refund to the resident taxpayer the amount of tax paid under section 55 less the amount of tax that would have otherwise have been payable under section 51.

Division 6 — Conveyances Used Interjurisdictionally

Section 59 – Definitions

PST - SEC.59/Int.

References:

Act: Section 1 "conveyance"; Part 3 – Division 6

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 59 the following definitions for the purposes of Division 6 [Conveyances Used Interjurisdictionally] of Part 3 [Taxes in Relation to Tangible Personal Property]:

"aircraft part" means a part of an interjurisdictional aircraft.

"conveyance part" means a part of an interjurisdictional railway rolling stock or a part of an interjurisdictional conveyance.

"eligible flights", in relation to an interjurisdictional aircraft, means flights originating or terminating in British Columbia or connecting 2 or more points in British Columbia.

"interjurisdictional aircraft" means an aircraft used

(a) interprovincially or internationally for commercial purposes, and

(b) in eligible flights.

"interjurisdictional conveyance" means a vessel or any other conveyance, other than an interjurisdictional aircraft or interjurisdictional railway rolling stock, used in interprovincial or international trade for the commercial carriage of passengers or goods.

"interjurisdictional railway rolling stock" means railway rolling stock used interprovincially or internationally.

"taxable conveyance" means the following:

(a) an interjurisdictional aircraft;

(b) an aircraft part;

(d) an interjurisdictional conveyance;

(e) a conveyance part.

Section 60 – Tax If Conveyance Purchased In British Columbia For Interjurisdictional Use

PST - SEC.60/Int.

References:

Act: Section 1 "conveyance", "registrant"; Section 37; Section 59 "aircraft part", "conveyance part", "eligible flights", "interjurisdictional aircraft", "interjurisdictional conveyance", "interjurisdictional railway rolling stock", "purchase price", "taxable conveyance"; Section 61; Section 65; Section 66; Section 67; Section 192

PSTERR: Section 149; Section 151; Section 152

PSTR: Section 18; Section 38; Section 79

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 60 the following taxing provision that applies when a person purchases in British Columbia a conveyance, or a part for a conveyance, that will be used for certain purposes.

Subsection 60(1) provides that section 60 applies to a person who

(a) purchases at a sale in British Columbia a conveyance and, from the date of purchase,

(i) in the case of an aircraft, uses the aircraft as an interjurisdictional aircraft,

(ii) in the case of railway rolling stock, uses the railway rolling stock as interjurisdictional railway rolling stock, and

(iii) in the case of a vessel or any other conveyance, other than an aircraft or railway rolling stock, uses the conveyance as an interjurisdictional conveyance, or

(b) purchases at a sale in British Columbia a part for a conveyance and, from the date of purchase, the part is to be installed in an interjurisdictional aircraft, interjurisdictional railway rolling stock or an interjurisdictional conveyance.

Subsection 60(2) provides that a person to whom section 60 applies must pay to the government tax on the taxable conveyance in the amount determined by the following formula:

amount = 7% × purchase price × (BC usage ÷ total usage)

where

purchase price = the purchase price of the taxable conveyance;

BC usage = whichever of the following is applicable:

(a) in relation to an interjurisdictional aircraft, the number of hours the aircraft will fly in the airspace over British Columbia in eligible flights during the period beginning on the date of purchase of the aircraft and ending on the third anniversary of that date;

(b) in relation to an aircraft part, the number of hours the aircraft in which the part is or is to be installed will fly in the airspace over British Columbia in eligible flights during,

in the case of a prescribed part, the period beginning on the date of purchase of the prescribed part and ending on the third anniversary of that date, and
in any other case, the year after the date of purchase of the part;

(c) in relation to interjurisdictional railway rolling stock or an interjurisdictional conveyance, the distance the conveyance will travel, during the year after its date of purchase, in British Columbia or, if the conveyance is a vessel, in the waters of British Columbia;

(d) in relation to a conveyance part, the distance the conveyance in which the part is or is to be installed will travel, during the year after the date of purchase of the part, in British Columbia or, if the conveyance is a vessel, in the waters of British Columbia;

total usage = whichever of the following is applicable:

(a) in relation to an interjurisdictional aircraft, the total number of hours the aircraft will fly during the period referred to in paragraph (a) of the description of "BC usage";

(b) in relation to an aircraft part, the total number of hours the aircraft in which the part is or is to be installed will fly during the period referred to in paragraph (b) of the description of "BC usage";

(c) in relation to interjurisdictional railway rolling stock or an interjurisdictional conveyance, the total distance the conveyance will travel during the year after its date of purchase;

(d) in relation to a conveyance part, the total distance the conveyance in which the part is or is to be installed will travel during the year after the date of purchase of the part.

Subsection 60(3) provides that tax payable under subsection 60(2) must be paid on or before the last day of the month after the month in which the person purchased the conveyance or the part for a conveyance.

Subsection 60(4) provides that despite subsection 60(3), tax payable under subsection 60(2) by a registrant must be paid

on or before the prescribed date (as provided under PSTR section 38 [section 60 of Act – tax if conveyance purchased in British Columbia for interjurisdictional use]; see PSTR/Sec. 38/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Section 61 – Tax If Sale And Lease-Back Of Conveyance

PST - SEC.61/Int.

References:

Act: Section 1 "conveyance", "registrant"; Section 13; Section 59 "interjurisdictional conveyance", "interjurisdictional railway rolling stock"; Section 60; Section 61.1; Section 62; Section 63; Section 64; Section 65; Section 66; Section 192

PSTR: Section 39; Section 79

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 61 the following taxing provision that applies if an interjurisdictional conveyance or an interjurisdictional railway rolling stock, in respect of which tax has been paid under section 60 [tax if conveyance purchased in British Columbia for interjurisdictional use], section 63 [tax if conveyance brought into and used in British Columbia] or section 64 [tax if change in use of conveyance acquired for resale], is sold and immediately leased back by the person (i.e., the lessee) who paid that tax.

A lessee is only required to pay tax under section 61 if the ratio of BC usage to total usage during a rental period exceeds the ratio of BC usage to total usage used to determine the tax the lessee originally paid under section 60, 63 or 64.

Subsection 61(0.1) provides the following definitions for the purposes of section 61:

"BC usage" means BC usage within the meaning of section 60, 63 or 64, as applicable;

"lease ratio", in relation to a conveyance for a rental period, means the ratio of the distance of travel by the conveyance in British Columbia or, if the conveyance is a vessel, in the waters of British Columbia during the rental period to the total distance of travel by the conveyance during that period;

"purchase ratio", in relation to a conveyance, means

(a) subject to paragraph (b), the ratio of the BC usage to the total usage that was used to determine the tax payable under section 60, section 63 or section 64 by a lessee, or

(b) the ratio of the BC usage to the total usage as determined in accordance with paragraph 66(1)(c) [adjustment of tax] by the lessee;

"total usage" means total usage within the meaning of section 60, section 63 or section 64, as applicable.

Subsection 61(1) provides that section 61 applies to a lessee of a conveyance if

(a) the lessee became lessee by selling the conveyance to the lessor under a sale and immediate lease-back arrangement,

(b) the lessee had, before the sale to the lessor, paid

(i) as purchaser of the conveyance the tax applicable under section 60, or

(ii) the tax applicable under section 63 or section 64 in relation to the conveyance, and

(i) interjurisdictional railway rolling stock, or

(ii) an interjurisdictional conveyance.

Subsection 61(2) provides that a lessee to whom section 61 applies must pay to the government, in respect of a rental period under the lease, tax calculated in accordance with subsection 61(3), if the lease ratio for the conveyance for the rental period exceeds the purchase ratio for the conveyance.

Subsection 61(3) provides that tax payable under subsection 61(2) must be calculated in accordance with the following formula:

tax = 7% × lease price × (lease ratio - purchase ratio)

where

lease price = the lease price of the conveyance attributable to the rental period;

lease ratio = the lease ratio for the conveyance for the rental period;

purchase ratio = the purchase ratio for the conveyance.

Subsection 61(4) provides that for the purposes of the definition of "lease ratio" in subsection 61(0.1), the distances of travel during a rental period are whichever of the following is applicable:

(a) if the lease price for a rental period is payable at the end of or after the end of the rental period, the actual distances travelled;

(b) in any other case, an estimate made in accordance with section 65 [estimate of hours or distance conveyance will travel] of the distances to be travelled.

Subsection 61(5) provides that tax payable under subsection 61(2) must be paid on or before the last day of the month after the month in which the rental period ends.

Subsection 61(6) provides that despite subsection 61(5), tax payable under subsection 61(2) by a registrant must be paid

on or before the prescribed date (as provided under PSTR section 39 [sections 61, 61.1 and 62 of Act – lease of conveyance]; see PSTR/Sec. 39/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Section 61.1 – Tax If Sale And Lease-Back Of Conveyance For Which Tax Paid Under Former Act

PST - SEC.61.1/Int.

References:

Act: Section 1 "conveyance", "entry date", "registrant"; Section 13; Section 59 "interjurisdictional conveyance", "interjurisdictional railway rolling stock"; Section 61; Section 62; Section 65; Section 66; Section 192

PSTR: Section 39; Section 79

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 61.1.

Section 61.1 provides the following taxing provision that applies if an interjurisdictional conveyance or an interjurisdictional railway rolling stock, in respect of which tax has been paid under section 13 or 15 of the Social Service Tax Act, is sold and immediately leased back by the person (i.e., the lessee) who paid that tax.

A lessee is only required to pay tax under section 61.1 if the ratio of BC usage to total usage during a rental period exceeds the initial ratio associated with the first year following the purchase or entry of the conveyance into British Columbia.

Subsection 61.1(1) provides the following definitions for the purposes of section 61.1:

"initial ratio", in relation to a conveyance, means the ratio of the distance of travel by the conveyance in British Columbia, or, if the conveyance is a vessel, in the waters of British Columbia during the first year

(a) after the date of purchase by the person who became the lessee of the conveyance if the conveyance is purchased in British Columbia, or

(b) after the entry date for the conveyance if the conveyance is not purchased in British Columbia

to the total distance of travel by the conveyance during that first year;

Subsection 61.1(2) provides that, subject to subsection 61.1(3), section 61.1 applies to a lessee of a conveyance if

(a) the lessee became lessee by selling the conveyance to the lessor under a sale and immediate lease-back arrangement,

(b) the lessee had, before the sale to the lessor, paid tax imposed under section 13 [calculation of tax if property is conveyance used interjurisdictionally] or section 15 [tax if conveyance purchased in B.C. for interjurisdictional use] of the Social Service Tax Act in respect of the conveyance and for which the lessee has not obtained and is not entitled to obtain a refund under that Act, and

(i) interjurisdictional railway rolling stock, or

(ii) an interjurisdictional conveyance.

Subsection 61.1(3) provides that section 61.1 does not apply to a lessee of a conveyance if section 61 applies to the lessee in respect of the conveyance.

Subsection 61.1(4) provides that a lessee to whom section 61.1 applies must pay to the government, in respect of a rental period under the lease, tax calculated in accordance with subsection 61.1(5), if the lease ratio for the conveyance for the rental period exceeds the initial ratio for the conveyance.

Subsection 61.1(5) provides that tax payable under subsection 61.1(4) must be calculated in accordance with the following formula:

tax = 7% × lease price × (lease ratio – initial ratio)

where

lease price = the lease price of the conveyance attributable to the rental period;

lease ratio = the lease ratio for the conveyance for the rental period;

initial ratio = the initial ratio for the conveyance.

Subsection 61.1(6) provides that for the purposes of the definition of "lease ratio" in subsection 61.1(1), the distances of travel during a rental period are whichever of the following is applicable:

(a) if the lease price for a rental period is payable at the end of or after the end of the rental period, the actual distances travelled;

(b) in any other case, an estimate made in accordance with section 65 [estimate of hours or distance conveyance will travel] of the distances to be travelled.

Subsection 61.1(7) provides that tax payable under subsection 61.1(4) must be paid on or before the last day of the month after the month in which the rental period ends.

Subsection 61.1(8) provides that despite subsection 61.1(7), tax payable under subsection 61.1(4) by a registrant must be paid

on or before the prescribed date (as provided under PSTR section 39 [sections 61, 61.1 and 62 of Act – lease of conveyance]; see PSTR/Sec. 39/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Section 62 – Tax If Leased Conveyance Used In British Columbia

PST - SEC.62/Int.

References:

Act: Section 1 "conveyance", "Excise Tax Act", "registrant"; Section 13; Section 59 "eligible flights", "interjurisdictional aircraft", "interjurisdictional conveyance", "interjurisdictional railway rolling stock"; Section 61; Section 61.1; Section 65; Section 66; Section 67; Section 192

PSTERR: Section 149; Section 150; Section 151

PSTR: Section 39; Section 79; Section 86

Interpretation (Issued: 2013/11)

Subsection 62(1) provides that, subject to subsection 62(2), section 62 applies to the following:

(a) a lessee who

(i) leases, in or outside British Columbia, an aircraft, and

(ii) uses, during a rental period under the lease, the aircraft as an interjurisdictional aircraft;

(b) a lessee who

(i) leases, in or outside British Columbia, any railway rolling stock, and

(ii) uses, during a rental period under the lease, the railway rolling stock as interjurisdictional railway rolling stock;

(i) leases, in or outside British Columbia, a vessel or other conveyance, other than railway rolling stock or an aircraft, and

(ii) uses, during a rental period under the lease, the vessel or other conveyance as an interjurisdictional conveyance.

Subsection 62(2) provides that section 62 does not apply to a lessee of a conveyance if section 61 [tax if sale and lease-back of conveyance] or section 61.1 [tax if sale and lease-back of conveyance for which tax paid under former Act] applies to the lessee in respect of the conveyance.

Subsection 62(3) provides that a lessee to whom section 62 applies must pay to the government, in respect of the rental period referred to in subsection 62(1), tax calculated in accordance with the following formula:

tax = 7% × lease price × (BC usage ÷ total usage)

where

lease price = the lease price of the conveyance attributable to the rental period;

BC usage = whichever of the following is applicable:

(a) in relation to an interjurisdictional aircraft, the number of hours the aircraft will fly during the rental period in the airspace over British Columbia in eligible flights;

(b) in relation to interjurisdictional railway rolling stock or an interjurisdictional conveyance, the distance the conveyance will travel, during the rental period, in British Columbia or, if the conveyance is a vessel, in the waters of British Columbia;

total usage = whichever of the following is applicable:

(a) in relation to an interjurisdictional aircraft, the total number of hours the aircraft will fly during that rental period;

(b) in relation to interjurisdictional railway rolling stock or an interjurisdictional conveyance, the total distance the conveyance will travel during that rental period.

Subsection 62(4) provides that for the purpose of calculations under subsection 62(3), the distances of travel during a rental period are whichever of the following is applicable:

(a) if the lease price for a rental period is payable at the end of or after the end of the rental period, the actual distances travelled;

(b) in any other case, an estimate made in accordance with section 65 [estimate of hours or distance conveyance will travel] of the distances to be travelled.

Subsection 62(5) provides that tax payable under subsection 62(3) must be paid on or before the last day of the month after the month in which the rental period ends.

Subsection 62(6) provides that despite subsection 62(5), tax payable under subsection 62(3) by a registrant must be paid

on or before the prescribed date (as provided under PSTR section 39 [sections 61, 61.1 and 62 of Act – lease of conveyance]; see PSTR/Sec. 39/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Subsection 62(7) provides that a conveyance is exempt from tax imposed under section 62 if

(a) the conveyance was sold to the lessor by the lessee under a sale and immediate lease-back arrangement, and

(b) the lessee had, before the sale to the lessor,

(i) paid tax imposed under section 19 [tax on designated property acquired in British Columbia] or section 20 [tax on designated property brought into British Columbia] of the Consumption Tax Rebate and Transition Act in respect of the conveyance and for which the person has not obtained and is not entitled to obtain a refund under that Act, or

(ii) in respect of the conveyance, paid tax imposed under section 165 (2), 212.1 or 218.1 or Division IV.1 of Part IX of the Excise Tax Act, in respect of British Columbia as a participating province under Part IX of that Act, and for which the person has not obtained and is not entitled to obtain a refund, credit or rebate under Part IX of that Act.

Section 63 – Tax If Conveyance Brought Into And Used In British Columbia

PST - SEC.63/Int.

References:

Act: Section 1 "BC resident", "conveyance", "entry date", "Excise Tax Act", "registrant"; Section 25; Section 54; Section 59 "aircraft part", "conveyance part", "eligible flights", "interjurisdictional aircraft", "interjurisdictional conveyance", "interjurisdictional railway rolling stock", "taxable conveyance"; Section 61; Section 65; Section 66; Section 67; Section 192

PSTERR: Section 149; Section 151; Section 152

PSTR: Section 18; Section 40; Section 79; Section 86

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 63 the following taxing provision that imposes tax on a conveyance that is brought, sent or delivered into British Columbia based on the use of the conveyance in British Columbia.

Subsection 63(1) provides that, subject to subsection 63(2), section 63 applies to a person in relation to a taxable conveyance if

(a) the person is a BC resident who brings or sends into British Columbia, or receives delivery of in British Columbia, the taxable conveyance and the conveyance is for use

(i) by the BC resident,

(ii) by another person at the BC resident's expense,

(iii) by a principal for whom the BC resident acts as agent, or

(iv) by another person at the expense of a principal for whom the BC resident acts as agent,

(b) the person is a BC resident and a person who is not a BC resident brings or sends into British Columbia, or receives delivery of in British Columbia, the taxable conveyance and the conveyance is for use

(i) by the BC resident, or

(ii) by the person who is not a BC resident, or by another person, at the BC resident's expense, or

(i) brings or sends into British Columbia, or receives delivery of in British Columbia, the taxable conveyance, and

(ii) uses the conveyance in British Columbia in the course of the person's business, whether or not the business is carried on in British Columbia.

Subsection 63(2) provides that section 63 does not apply to a person if any person referred to in subsection 63(1) has leased the taxable conveyance, as lessee.

Subsection 63(3) provides that a person to whom section 63 applies must pay to the government tax on the taxable conveyance in the amount determined by the following formula:

amount = 7% × purchase price × (BC usage ÷ total usage)

where

purchase price = the purchase price of the taxable conveyance;

BC usage = whichever of the following is applicable:

(a) in relation to an interjurisdictional aircraft, the number of hours the aircraft will fly in the airspace over British Columbia in eligible flights during the period beginning on the entry date of the aircraft and ending on the third anniversary of that date;

(b) in relation to an aircraft part, the number of hours the aircraft in which the part is or is to be installed will fly in the airspace over British Columbia in eligible flights during,

in the case of a prescribed part, the period beginning on the entry date of the prescribed part and ending on the third anniversary of that date, and
in any other case, the year after the entry date of the part;

(c) in relation to interjurisdictional railway rolling stock or an interjurisdictional conveyance, the distance the conveyance will travel, during the year after its entry date, in British Columbia or, if the conveyance is a vessel, in the waters of British Columbia;

(d) in relation to a conveyance part, the distance the conveyance in which the part is or is to be installed will travel, during the year after the entry date of the part, in British Columbia or, if the conveyance is a vessel, in the waters of British Columbia;

total usage = whichever of the following is applicable:

(a) in relation to an interjurisdictional aircraft, the total number of hours the aircraft will fly during the period referred to in paragraph (a) of the description of "BC usage";

(c) in relation to interjurisdictional railway rolling stock or an interjurisdictional conveyance, the total distance the conveyance will travel during the year after its entry date;

(d) in relation to a conveyance part, the total distance the conveyance in which the part is or is to be installed will travel during the year after the entry date of the part.

Subsection 63(4) provides that tax payable under subsection 63(3) must be paid on or before the last day of the month after the month that includes the entry date of the taxable conveyance.

Subsection 63(5) provides that despite subsection 63(4), tax payable under subsection 63(3) by a registrant must be paid

on or before the prescribed date (as provided under PSTR section 40 [section 63 of Act – tax if conveyance brought into and used in British Columbia]; see PSTR/Sec. 40/Int.), and
in the prescribed manner (as provided under subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Section 64 – Tax If Change In Use Of Conveyance Acquired For Resale

PST - SEC.64/Int.

References:

Act: Section 1 "conveyance", "registrant"; Section 59 "aircraft part", "conveyance part", "eligible flights", "interjurisdictional aircraft", "interjurisdictional conveyance", "interjurisdictional railway rolling stock", "taxable conveyance"; Section 61; Section 65; Section 66; Section 81; Section 192

PSTERR: Section 149; Section 151; Section 152

PSTR: Section 18; Section 40; Section 79

Interpretation (Issued: 2013/11; Revised: 2016/01)

Effective April 1, 2013 Bill 13, Finance Statutes Amendment Act, 2015 amends subsection 64(3).Subsection 64 (3) establishes that tax payable on change of use of a conveyance must be paid on or before the last day of the month after the month in which the person first becomes a user of the conveyance. The amendment replaces the reference to "conveyance" with the defined term "taxable conveyance". The term "taxable conveyance" refers to a conveyance part. The prorated tax that is imposed under subsection 64 (2) of the Provincial Sales Tax Act is intended to apply to both conveyances and parts for a conveyance.

The amendment clarifies that the time period for paying the prorated tax will also apply to both conveyances and parts for a conveyance.

Section 65 – Estimate Of Hours Or Distance Conveyance Will Travel

PST - SEC.65/Int.

References:

Act: Section 1 "conveyance"; Part 3 – Division 6; Section 60; Section 61; Section 61.1; Section 62; Section 63; Section 64; Section 65; Section 66

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 65 that certain calculations in Division 6 [Conveyances Used Interjurisdictionally] of Part 3 [Taxes in Relation to Tangible Personal Property] must be based on a reasonable estimate.

Subsection 65(1) provides that in section 65, "relevant provision" means the following:

(a) subsection 60(2) [tax if conveyance purchased in British Columbia for interjurisdictional use], subsection 62(3) [tax if leased conveyance used in British Columbia], subsection 63(3) [tax if conveyance brought into and used in British Columbia] and subsection 64(2) [tax if change in use of conveyance acquired for resale];

(b) the definition of "lease ratio" in subsection 61(0.1) [tax if sale and lease-back of conveyance];

(c) the definitions of "initial ratio" and "lease ratio" in subsection 61.1(1) [tax if sale and lease-back of conveyance for which tax paid under former Act].

Subsection 65(2) provides that for the purposes of the relevant provisions, the following must be based on a reasonable estimate:

(a) the number of hours or the distance a conveyance will travel during the relevant period in the airspace over, in the waters of or in British Columbia;

(b) the total number of hours or the total distance the conveyance will travel during the period referred to in paragraph (a).

Section 66 – Adjustment Of Tax

PST - SEC.66/Int.

References:

Act: Section 1 "conveyance", "registrant"; Section 60; Section 61; Section 61.1; Section 62; Section 63; Section 64; Section 65; Section 192

PSTERR: Section 149; Section 151; Section 152

PSTR: Section 42; Section 79

Bulletin PST 400

Interpretation (Issued: 2013/11)

Subsection 66(1) provides that if, for the purposes of a relevant provision as defined in subsection 65(1) [estimate of hours or distance conveyance will travel], an estimate is made under section 65 for a relevant period in relation to a conveyance, at the end of the period the person to whom subsection 60(2) [tax if conveyance purchased in British Columbia for interjurisdictional use], subsection 61(2) [tax if sale and lease-back of conveyance], subsection 61.1(4) [tax if sale and lease-back of conveyance for which tax paid under former Act], subsection 62(3) [tax if leased conveyance used in British Columbia], subsection 63(3) [tax if conveyance brought into and used in British Columbia] or subsection 64(2) [tax if change in use of conveyance acquired for resale] applies must determine the following:

(a) the actual number of hours or the actual distance the conveyance travelled during the relevant period in the airspace over, in the waters of or in British Columbia;

(b) the total actual number of hours or the total actual distance the conveyance travelled during that relevant period;

(c) the amount determined by the formula in subsection 60(2), subsection 61(3), subsection 61.1(5), subsection 62(3), subsection 63(3) or subsection 64(2), using the hours and distance determined under paragraphs 66(1)(a) and 66(1)(b) instead of the estimated hours and distance.

Subsection 66(1.1) provides that for the purposes of subsection 66(1), if a conveyance is sold within a relevant period, the relevant period in relation to the conveyance is deemed to end at the time of sale.

Subsection 66(2) provides that if the amount determined under paragraph 66(1)(c) for a relevant period exceeds the amount determined under the applicable section for the relevant period based on the reasonable estimate under section 65, the person to whom the applicable section applies must pay to the government tax equal to the amount of the excess.

Subsection 66(3) provides that tax payable under subsection 66(2) must be paid on or before the last day of the month after the month in which the relevant period ends.

Subsection 66(3.1) provides that despite subsection 66(3), tax payable under subsection 66(2) by a registrant must be paid

•on or before the prescribed date (as provided under PSTR section 42 [section 66 of Act – adjustment of tax]; see PSTR/Sec. 42/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Subsection 66(4) provides that if the director is satisfied that the amount determined under the applicable section for a relevant period based on the reasonable estimate under section 65 exceeds the amount determined under paragraph 66(1)(c) for the relevant period, the director must refund to the person to whom the applicable section applies the amount of the excess.

Section 67 – Refund For Conveyances Used Interjurisdictionally

PST - SEC.67/Int.

References:

Act: Section 1; Section 37; Section 39; Section 49; Part 3 – Division 6; Section 60; Section 62; Section 63

PSTERR: Section 149; Section 151; Section 152

PSTR: Section 42; Section 79

Bulletin PST 400

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 67 the refund provision that applies if the director is satisfied that:

(a) a person has paid tax under section 37 [tax on purchase], section 39 [tax on leases] or section 49 [tax if tangible personal property brought into British Columbia for use] in respect of a conveyance or a part for a conveyance, and

(b) the person ought to have paid tax under section 60 [tax if conveyance purchased in British Columbia for interjurisdictional use], section 62 [tax if leased conveyance used in British Columbia] or section 63 [tax if conveyance brought into and used in British Columbia], as applicable, in respect of the conveyance or part instead of paying tax under section 37, section 39 or section 49,

the director must refund to that person the difference between the tax paid by the person on the conveyance or part and the tax that ought to have been paid in accordance with Division 6 [Conveyances Used Interjurisdictionally] of Part 3 [Taxes in Relation to Tangible Personal Property].

Division 7 — Multijurisdictional Vehicles

Section 68 – Definitions

PST - SEC.68/Int.

References:

Act: Section 1 "fair market value", "fleet licensing date", "lessee", "trailer", "vehicle"; Part 3 – Division 7

PSTERR: Section 135; Section 137; Section 138

PSTR: Section 19.1

Bulletin PST 135

Interpretation (Issued: 2013/11; Revised: 2016/01)

Effective January 1, 2015, Bill 10, Budget Measures Implementation Act, 2015, amends section 68 to repeal the definition of "calculation year" and to modify the definition of "travel ratio".

The definition of "calculation year" is moved to PSTR subsection 19.1(1) [Travel Ratio].

The amended definition of "travel ratio" provides that while the travel ratio remains a component of the MJV tax calculation in subsection 69(2), it is determined in accordance with PSTR subsection 19.1.

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 68 a series of definitions for the purposes of Division 7 [Multijurisdictional Vehicles] of Part 3 [Taxes in Relation to Tangible Personal Property].

Section 69 – Tax If Multijurisdictional Vehicle Licensed

PST - SEC.69/Int.

References:

Act: Section 1 "fleet licensing date", "multijurisdictional vehicle", "vehicle licence period"; Section 37; Part 3 – Division 7; Section 68 "acquisition year", "bus", "fleet licence year", "prorating agreement", "travel ratio", "vehicle", "vehicle taxable value"; Section 70; Section 71; Section 71.1; Section 72; Section 72.1; Section 74; Section 74.1; Section 75.1; Section 76; Section 192

PSTERR: Section 135; Section 136; Section 137

PSTR: Section 19.1

Bulletin PST 135

Interpretation (Issued: 2013/11; Revised: 2016/01)

Effective January 1, 2015, Bill 10, Budget Measures Implementation Act, 2015, repeals subsection 69(4), which contained rules for determining the travel ratio for a vehicle. The travel ratio for a vehicle is now determined in accordance with PSTR section 19.1 [Travel Ratio].

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 69 the taxing provision that imposes multijurisdictional vehicle (MJV) tax on a vehicle that is prorate licensed (i.e., registered under the International Registration Plan).

International Registration Plan (IRP)

IRP is an international prorating agreement that allows for the licence fees and taxes that apply in various jurisdictions to be collected at the time MJVs are registered and licensed in their home jurisdiction. These fees and taxes take into account the travel by the MJV in the jurisdictions in which they travel. All jurisdictions in North America are members of IRP, other than the Yukon, Northwest Territories, Nunavut, Alaska and Mexico. Registration with IRP considerably reduces the administrative burden for the interjurisdictional carrier industry. On January 1, 2015, the IRP became a "full reciprocity plan" that allows licensees to operate in all 59 IRP jurisdictions without the need for updates to their vehicle licences (see PSTR Sec. 19.1/R.1).

MJV Tax

MJV tax only applies to vehicles licensed within British Columbia or outside British Columbia under a prorate agreement. MJV tax is paid at the time of licensing, generally annually, and is determined based on the value of the vehicle, its age, and the distance traveled in British Columbia during the vehicle licence period.

Section 70 – When Tax Under Section 69 Must Be Paid

PST - SEC.70/Int.

References:

Act: Section 1 "vehicle licence period"; Part 3 – Division 7; Section 68 "vehicle"; Section 69; Section 189; Section 192

PSTR: Section 19

Bulletin PST 135

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 70 the taxing provision that provides for when tax under subsection 69(1) [tax if multijurisdictional vehicle licensed] must be paid.

Subsection 70(1) provides that tax payable under subsection 69(1) for a vehicle licence period in respect of a vehicle must be paid as follows:

(a) if the vehicle is licensed in British Columbia, the tax must be paid to the government, by paying the tax to the Insurance Corporation of British Columbia, at the time that the vehicle is licensed for that vehicle licence period;

(b) in any other case, unless paid earlier under subsection 70(2), the tax must be paid to the government on or before the last day of the month after the month in which the vehicle first enters British Columbia in that vehicle licence period.

Subsection 70(2) provides that if the vehicle in respect of which tax is payable under Division 7 [Multijurisdictional Vehicles] of Part 3 [Taxes in Relation to Tangible Personal Property] is licensed in a prescribed jurisdiction outside British Columbia, the tax may be paid, by paying the tax to the prescribed jurisdiction, at the time that the vehicle is licensed in that jurisdiction for that vehicle licence period. Under PSTR section 19 [prescribed jurisdictions for section 70 of Act], the prescribed jurisdictions are those jurisdictions that are member jurisdictions in the International Registration Plan (IRP).

Section 71 – Adjustment Of Tax Under Section 69

PST - SEC.71/Int.

References:

Act: Section 1 "multijurisdictional vehicle", "vehicle licence period"; Section 68 "fleet licence year", "travel ratio", "vehicle"; Section 69; Section 72; Section 72.1; Section 74; Section 74.1; Section 192

Bulletin PST 135

Interpretation (Issued: 2013/11; Revised: 2016/01)

Effective January 1, 2015, Bill 10, Budget Measures Implementation Act, 2015, amends section 71 such that it only applies in respect of a licence for which a travel ratio was determined using estimated distances under the procedures set out in subsection 69(4) prior to its repeal.

Section 71 does not apply to a licence issued for a vehicle licence period commencing on or after January 1, 2015.

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 71 the taxing and refund provisions that apply where the actual use of a multijurisdictional vehicle is different than the estimated use.

Section 72 – Tax if Vehicle Ceases to be Multijurisdictional

PST - SEC.72/Int.-R.1

References:

Act: Section 1 "multijurisdictional vehicle", "purchase price"; Section 25; Section 68 "prorating agreement", "vehicle"; Section 69; Section 71; Section 74.1

PSTERR: Section 135

Bulletin PST 135

Interpretation (Issued: 2013/11; Revised: 2014/09; 2024/03)

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 amended section 72 to change the manner in which the multijurisdictional vehicle (MJV) "exit tax" applies. The amendment limited the application of the tax to vehicles that become licensed for use solely within BC.

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 repealed and replaced section 72.

Section 72 imposes an "exit tax" when a vehicle ceases to be an MJV and subsequently becomes licensed for use solely within BC. Where exit tax applies, the amount of tax charged and collected by the Insurance Corporation of British Columbia is automatically reduced by a credit, calculated in accordance with the regulations (as provided under PSTERR section 135 [credit if vehicle ceases to be multijurisdictional]; see PSTERR/Sec. 135/Int.).

R.1 Remission of Tax if Vehicle Ceases to be Multijurisdictional Between March 11, 2020, and September 30, 2020 (Issued: 2024/03)

During the Covid-19 pandemic, some vehicle operators had to restructure or redesign their operations to remain viable. For some operators this meant leaving the MJV scheme to operate their vehicles solely within B.C. As a result, government introduced temporary measures to support the transport industry in these situations.

Order in Council 223/2020, dated May 4, 2020, authorizes a remission of tax in relation to the amount of tax paid or payable in respect of the purchase price of a vehicle.

Conditions for remission

The remission only applies providing all of the following conditions have been met:

The vehicle was purchased before May 4, 2020, and
The prorate licence for the vehicle is cancelled between March 11, 2020 and September 30, 2020, and the vehicle is subsequently licensed for use solely within B.C.

The credit under subsection 72(5) is no longer available since exit tax is not payable. However, a refund may be available from ICBC under PSTERR section 138.2 [special refunds by Insurance Corporation of British Columbia].

Section 72.1 – Tax if Transferred Vehicle Ceases to be Multijurisdictional

PST - SEC.72.1/Int.-R1

References:

Act: Section 1 "multijurisdictional vehicle", "purchase price"; Section 25; Section 68 "prorating agreement", "vehicle"; Section 69; Section 71; Section 74.1

PSTERR: Section 135

Bulletin PST 135

Interpretation (Issued: 2013/11; Revised: 2014/09, 2024/04)

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 amended section 72.1 to change the manner in which the multijurisdictional vehicle (MJV) "exit tax" applies. The amendment limited the application of the tax to vehicles that become licensed for use solely within BC.

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 72.1.

Section 72.1 imposes an "exit tax" when a transferred vehicle ceases to be an MJV and subsequently becomes licensed for use solely within BC. A transferred vehicle is a vehicle that, while it was licensed as an MJV, was operated under what is commonly referred to as an "owner-operator" arrangement. . Where exit tax applies, the amount of tax charged and collected by the Insurance Corporation of British Columbia is automatically reduced by a credit, calculated in accordance with the regulations (as provided under PSTERR section 135 [credit if vehicle ceases to be multijurisdictional]; see PSTERR/Sec. 135/Int.).

R.1 Remission of Tax if Vehicle Ceases to be Multijurisdictional Between March 11, 2020, and September 30, 2020 (Issued: 2024/03)

During the Covid-19 pandemic, some vehicle operators had to restructure or redesign their operations to remain viable. For some operators this meant leaving the MJV scheme to operate their vehicles solely within BC. As a result, government introduced temporary measures to support the transport industry.

Order in Council 223/2020, dated May 4, 2020 authorizes a remission of tax in relation to the amount of tax paid or payable in respect of the purchase price of a vehicle.

Conditions for remission

The remission only applies providing all of the following conditions have been met:

The vehicle was purchased before May 4, 2020, and
The prorate licence for the vehicle is cancelled between March 11, 2020, and September 30, 2020, and the vehicle is subsequently licensed for use solely within B.C.

The credit under subsection 72.1(5) is no longer available since exit tax is not payable. However, a refund may be available from ICBC under PSTERR section 138.2 [special refunds by Insurance Corporation of British Columbia].

Section 73 – Liability Of Other Persons

PST - SEC.73/Int.

References:

Act: Section 1 "vehicle licence period"; Part 3 – Division 7; Section 68 "vehicle"

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 73 that if tax is payable by a person under Division 7 [Multijurisdictional Vehicles] of Part 3 [Taxes in Relation to Tangible Personal Property] in respect of a vehicle for a vehicle licence period, any other person who had management of or the right to determine the utilization of the vehicle while it was in British Columbia during the vehicle licence period is jointly and severally liable with any other person liable for that tax.

Section 74 – Refund Or Credit Of Tax If Fleet Licensing Changed

PST - SEC.74/Int.

References:

Act: Section 1 "fleet licence year", "multijurisdictional vehicle", "vehicle licence period"; Part 3 – Division 7; Section 68 "prorating agreement", "vehicle"; Section 69; Section 71

PSTERR: Section 136

Bulletin PST 135; Bulletin PST 400

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 74 a refund or credit of the remaining portion of the multijurisdictional vehicle (MJV) tax paid for the previous licence if an MJV is transferred to a different fleet and MJV tax is paid under the new fleet, in certain circumstances.

The refund and credit are calculated in accordance with the regulations (as provided under PSTERR section 136 [refund or credit of tax if fleet licensing changed]; see PSTERR/Sec. 136/Int.).

Subsection 74(0.1) provides that in section 74, "licensed" means licensed under a licence to which a prorating agreement applies.

Subsection 74(1) provides that if a vehicle that is licensed by a person as part of a fleet is, before the end of the fleet licence year applicable to that fleet, licensed by the person as part of a different fleet,

(a) that person must pay to the government tax imposed under subsection 69(1) [tax if multijurisdictional vehicle licensed] in respect of the vehicle's vehicle licence period when licensed as part of the different fleet, and

(b) that person is entitled to a credit under subsection 74(2) or refund under subsection 74(3) in relation to the tax paid by that person under one or both of section 69 and section 71 [adjustment of tax under section 69] in respect of the vehicle for the last vehicle licence period under the previous licence.

Subsection 74(1.1) provides that subsection 74(1.2) applies in relation to a vehicle if

(a) a person transferred the vehicle under an agreement but retained a beneficial interest in the vehicle,

(b) the vehicle was licensed by another person as part of a fleet,

(c) the vehicle is, before the end of the fleet licence year applicable to that fleet, licensed by the person referred to in paragraph 74(1.1)(a) or by a third person as part of a different fleet, and

(d) the person referred to in paragraph 74(1.1)(a) retains a beneficial interest in the vehicle.

Subsection 74(1.2) provides that if subsection 74(1.2) applies in relation to a vehicle, the person who licensed the vehicle as part of the different fleet referred to in paragraph 74(1.1)(c)

(a) must pay to the government tax imposed under subsection 69(1) in respect of the vehicle's vehicle licence period when licensed as part of the different fleet, and

(b) is entitled to a credit under subsection 74(2) or refund under subsection 74(3) in relation to the tax paid under one or both of section 69 and section 71 in respect of the vehicle for the last vehicle licence period under the previous licence.

Subsection 74(2) provides that if the vehicle that is licensed as part of a different fleet is licensed in British Columbia, the Insurance Corporation of British Columbia must provide to the person, at the time the vehicle is licensed as part of the different fleet, a credit of a portion of the tax previously paid under one or both of section 69 and section 71 in respect of the vehicle for the last vehicle licence period under the previous licence against the amount of any tax that the person is required to pay under Division 7 [Multijurisdictional Vehicles] of Part 3 [Taxes in Relation to Tangible Personal Property].

Subsection 74(3) provides that if the vehicle that is licensed as part of a different fleet is not licensed in British Columbia, the director may pay to the person a refund of a portion of the tax previously paid under one or both of section 69 and section 71 in respect of the vehicle for the last vehicle licence period under the previous licence.

Subsection 74(4) provides that the credit to which a person is entitled under subsection 74(2)

(a) must be calculated in accordance with the regulations (as provided under PSTERR section 136),

(b) must be applied against any tax payable under Division 7 of Part 3 by the person in respect of the vehicle until the full amount of the credit has been applied in that manner, and

Subsection 74(5) provides that a refund under subsection 74(3) must be calculated in accordance with the regulations (as provided under PSTERR section 136).

Section 74.1 – Refund If Vehicle Ceases To Be Multijurisdictional

PST - SEC.74.1/Int.

References:

Act: Section 1 "multijurisdictional vehicle", "vehicle licence period"; Section 68 "prorating agreement", "vehicle"; Section 69; Section 71; Section 72; Section 72.1; Section 74

PSTERR: Section 137

Bulletin PST 135; Bulletin PST 400

Interpretation (Issued: 2013/11; Revised: 2014/09)

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 amended section 74.1. The amendment divided the refund authority found in the previous version of section 74.1 into two sections: the post-amendment section 74.1 and a new section 74.2.

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 74.1.

Section 74.1 provides for the refund of a portion of the multijurisdictional vehicle (MJV) tax paid by a person in respect of a vehicle, if certain conditions are met, in cases when a vehicle ceases to be licensed as an MJV before the end of its vehicle licence period and the vehicle either:

becomes licensed for use solely within BC, but no "exit tax" is payable (and thus no credit is provided) under section 72 or section 72.1, or
becomes licensed for use within another jurisdiction and is not licensed for use within BC.

The refund is calculated in accordance with the regulations (as provided under PSTERR section 137 [refund if not entitled to credit under section 72 or 72.1 of Act]; see PSTERR/Sec. 137/Int.).

Section 74.2 - Refund at End of Vehicle Licence Period

PST - SEC.74.2/Int.

References:

Act: Section 1 "multijurisdictional vehicle", "vehicle licence period"; Section 68 "prorating agreement", "vehicle"; Section 69; Section 71; Section 74

PSTERR: Section 137.1

Bulletin PST 135; Bulletin PST 400

Interpretation (Issued: 2014/09)

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 added section 74.2.

Section 74.2 provides for the refund of a portion of the multijurisdictional vehicle (MJV) tax paid by a person in respect of a vehicle, if certain conditions are met, in cases when a vehicle ceases to be licensed as an MJV before the end of its vehicle licence period and the vehicle, at the conclusion of the original vehicle licence period, has not become licensed for use solely within BC.

The refund is calculated in accordance with the regulations (as provided under PSTERR section 137.1 [refund at end of vehicle licence period]; see PSTERR/Sec. 137.1/Int.).

Section 75 – Credit If Tax Previously Paid

PST - SEC.75/Int.

References:

Act: Section 1 "multijurisdictional vehicle", "purchase price"; Section 37; Section 49; Section 50; Part 3 – Division 7; Section 68 "acquisition date", "prorating agreement", "vehicle"

PSTERR: Section 138

Bulletin PST 135

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 75 a partial credit of the PST paid on a vehicle if the vehicle becomes a multijurisdictional vehicle (MJV) licensed under a prorate licence under the International Registration Plan (IRP) before the end of the 4th calendar year after the calendar year in which is its acquisition date, in certain circumstances.

The credit is calculated in accordance with the regulations (as provided under PSTERR section 138 [credit if tax previously paid]; see PSTERR/Sec. 138/Int.).

Subsection 75(1) provides that the Insurance Corporation of British Columbia must provide a credit to a person who licenses a vehicle in British Columbia under a licence to which a prorating agreement applies if

(a) the vehicle is so licensed before the end of the 4th calendar year after the calendar year in which is its acquisition date, and

(b) Repealed

(i) section 37 [tax on purchase],

(ii) subsection 49(5) [tax if tangible personal property brought into British Columbia for use], as that tax was calculated under subsection 49(6), or

(iii) section 50 [tax on registration of vehicle brought into British Columbia].

Subsection 75(1.1) provides that the Insurance Corporation of British Columbia must provide a credit to a person who licenses a vehicle in British Columbia under a licence to which a prorating agreement applies if

(a) the vehicle is transferred to the person under an agreement but the transferor retains a beneficial interest in the vehicle,

(b) the vehicle is so licensed before the end of the 4th calendar year after the calendar year in which is the transferor's acquisition date for the vehicle, and

(c) the transferor referred to in paragraph 75(1.1)(a) had previously paid tax on the purchase price of the vehicle under

(i) section 37,

(ii) subsection 49(5), as that tax was calculated under subsection 49(6), or

(iii) section 50.

Subsection 75(2) provides that the credit to which a person is entitled under subsection 75(1) or subsection 75(1.1)

(a) must be calculated in accordance with the regulations (as provided under PSTERR section 138),

(b) must be applied against any tax payable under Division 7 [Multijurisdictional Vehicles] of Part 3 [Taxes in Relation to Tangible Personal Property] by the person in respect of the vehicle until the full amount of the credit has been applied in that manner, and

Section 75.1 – Transition – Credit If Tax Previously Paid

PST - SEC.75.1/Int.

References:

Act: Section 1 "Excise Tax Act", "multijurisdictional vehicle"; Part 3 – Division 7; Section 68 "acquisition date", "prorating agreement", "vehicle"; Section 69

PSTERR: Section 138

Bulletin PST 135

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 75.1.

Similar to section 75 [credit if tax previously paid], section 75.1 provides a partial credit of other taxes previously paid on a vehicle if the vehicle becomes a multijurisdictional vehicle (MJV) licensed under a prorate licence under the International Registration Plan (IRP) before the end of the 4th calendar year after the calendar year in which is its acquisition date, in certain circumstances.

The credit is calculated in accordance with the regulations (as provided under PSTERR section 138 [credit if tax previously paid]; see PSTERR/Sec. 138/Int.).

Subsection 75.1(1) provides that the Insurance Corporation of British Columbia must provide a credit to a person who licenses a vehicle in British Columbia under a licence to which a prorating agreement applies if

(a) the vehicle is so licensed before the end of the 4th calendar year after the calendar year in which is its acquisition date,

(b) the person had previously

(i) paid tax in relation to the vehicle under section 5 [tax on purchase] or subsection 11(3) [tax if tangible personal property brought into British Columbia for use] of the Social Service Tax Act and for which the person has not obtained and is not entitled to obtain a refund under that Act,

(ii) paid tax in relation to the vehicle under section 19 [tax on designated property acquired in British Columbia], section 20 [tax on designated property brought into British Columbia] or section 21 [tax on registration of vehicle brought into British Columbia] of the Consumption Tax Rebate and Transition Act and for which the person has not obtained and is not entitled to obtain a refund under that Act, or

(iii) paid tax in relation to the vehicle under section 165 (2), 212.1 or 218.1 or Division IV.1 of Part IX of the Excise Tax Act, in respect of British Columbia as a participating province under Part IX of that Act, that the person previously paid in relation to the tangible personal property and for which the person has not obtained and is not entitled to obtain a refund, credit or rebate under Part IX of that Act,

(c) the vehicle was purchased in British Columbia or was first brought, sent or delivered into British Columbia after March 31, 2009 but before April 1, 2013, and

(d) the vehicle is subject to tax imposed under section 69 [tax if multijurisdictional vehicle licensed] of this Act.

Subsection 75.1(2) provides that the Insurance Corporation of British Columbia must provide a credit to a person who licenses a vehicle in British Columbia under a licence to which a prorating agreement applies if

(a) the vehicle is transferred to the person under an agreement but the transferor retains a beneficial interest in the vehicle,

(b) the vehicle is so licensed before the end of the 4th calendar year after the calendar year in which is the transferor's acquisition date for the vehicle,

(i) paid tax in relation to the vehicle under section 5 or subsection 11(3) of the Social Service Tax Act and for which the person has not obtained and is not entitled to obtain a refund under that Act,

(ii) paid tax in relation to the vehicle under section 19, section 20 or section 21 of the Consumption Tax Rebate and Transition Act and for which the person has not obtained and is not entitled to obtain a refund under that Act, or

(d) the vehicle was purchased in British Columbia or was first brought, sent or delivered into British Columbia after March 31, 2009 but before April 1, 2013, and

(e) the vehicle is subject to tax imposed under section 69.

Subsection 75.1(3) provides that the credit to which a person is entitled under subsection 75.1(1) or subsection 75.1(2)

(a) must be calculated in accordance with the regulations (as provided under PSTERR section 138),

Section 75.2 - Refund From Insurance Corporation of British Columbia Authorized Under Regulations

PST - SEC.75.2/Int.

References:

Act: Section 69; Section 71

PSTERR: Section 138.1

Bulletin PST 135; Bulletin PST 400

Interpretation (Issued: 2014/09)

Effective March 24, 2014, Bill 8, Budget Measures Implementation Act, 2014 added section 75.2.

Section 75.2 provides for the refund of all or part of an amount paid as tax under Division 7 [Multijurisdictional Vehicles] of Part 3 [Taxes in Relation to Tangible Personal Property]. A refund under section 75.2 is payable by ICBC.

Refunds under section 75.2 are only payable under circumstances prescribed under PSTERR section 138.1 [refunds from Insurance Corporation of British Columbia]; see PSTERR/Sec. 138.1/Int.).

Section 76 – Refund Or Credit For Trade-In Vehicles

PST - SEC.76/Int.-R.1

References:

Act: Section 1 "multijurisdictional vehicle", "purchase price", "vehicle licence period"; Part 3 – Division 7; Section 68 "prorating agreement", "vehicle"; Section 69

PSTERR: Section 139

Bulletin PST 135; Bulletin PST 400

Interpretation (Issued: 2013/11)

The refund and credit are calculated in accordance with the regulations (as provided under PSTERR section 139 [refund or credit for trade-in vehicles]; see PSTERR/Sec. 139/Int.).

Subsection 76(1) provides that in section 76:

"new vehicle" means the vehicle referred to in the definition of "trade-in vehicle" in respect of which tax is payable under section 69 [tax if multijurisdictional vehicle licensed];

"trade-in vehicle" means a multijurisdictional vehicle on which tax has been paid under Division 7 [Multijurisdictional Vehicles] of Part 3 [Taxes in Relation to Tangible Personal Property] and that, before the expiration of its current vehicle licence period, is accepted at the time of sale by the seller on account of the purchase price of another multijurisdictional vehicle in respect of which tax is payable under section 69.

Subsection 76(2) provides that if the new vehicle is licensed in British Columbia under a licence to which a prorating agreement applies, the Insurance Corporation of British Columbia must provide to the person licensing the new vehicle, at the time the vehicle is licensed, a credit of a portion of the tax paid under Division 7 of Part 3 on the trade-in vehicle against the amount of tax the person is required to pay under Division 7 of Part 3 in respect of the new vehicle.

Subsection 76(3) provides that if the new vehicle is licensed outside British Columbia under a licence to which a prorating agreement applies, the director may provide to the person who licensed the new vehicle a refund of a portion of the tax paid on the trade-in vehicle.

Subsection 76(4) provides that, subject to subsection 76(5), the credit under subsection 76(2) and the refund under subsection 76(3) must be limited to the tax paid under Division 7 of Part 3 that is attributable to the portion of the current vehicle licence period of the trade-in vehicle remaining after the trade-in vehicle has been traded.

Subsection 76(5) provides that the credit to which a person is entitled under subsection 76(2)

(a) must be calculated in accordance with the regulations (as provided under PSTERR section 139),

(b) must be applied against any tax payable under Division 7 of Part 3 by the person in respect of the vehicle until the full amount of the credit has been applied in that manner, and

Subsection 76(6) provides that a refund under subsection 76(3) must be calculated in accordance with the regulations (as provided under PSTERR section 139).

R.1 Multijurisdictional Vehicle Trade-Ins (Issued: 2014/04)

No refund is available when a multijurisdictional vehicle is traded-in toward the lease price of a leased vehicle because of the definition of "trade-in vehicle" under section 76. The definition specifically requires the trade-in vehicle be "on account of the purchase price" of another multijurisdictional vehicle.

Section 77 – Refund For Replacement Vehicles

PST - SEC.77/Int.

References:

Act: Section 1 "multijurisdictional vehicle", "vehicle licence period"; Section 39; Part 3 – Division 7; Section 68 "vehicle"

Bulletin PST 135; Bulletin PST 400

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 77 the refund provision that applies when a person pays multijurisdictional vehicle (MJV) tax on a replacement vehicle (or PST on the lease price of a replacement vehicle) that is leased while that person’s MJV is being repaired.

Subsection 77(1) provides that in section 77, "replacement vehicle" means a vehicle that is leased to be used as a replacement for a multijurisdictional vehicle that

(a) is being repaired, and

(b) is therefore unavailable for use during part of its vehicle licence period.

Subsection 77(2) provides that, subject to subsection 77(3) and subsection 77(4), if the director is satisfied that

(a) a person has paid tax under Division 7 [Multijurisdictional Vehicles] of Part 3 [Taxes in Relation to Tangible Personal Property] or under subsection 39(1) [tax on leases] on a replacement vehicle,

(b) tax has been paid under Division 7 of Part 3 on the multijurisdictional vehicle being repaired, and

(i) in accordance with the terms of the licence that was issued for the multijurisdictional vehicle being repaired, and

(ii) for the purposes for which that multijurisdictional vehicle would be used were it not being repaired,

the director must refund to the person the tax referred to in paragraph 77(2)(a).

Subsection 77(3) provides that any refund under section 77 is, if the refund is in respect of tax paid under subsection 39(1), limited to the tax paid on lease payments for the replacement vehicle in respect of rental periods, or portions of rental periods, that are wholly within

(a) the period during which the multijurisdictional vehicle is being repaired, and

(b) the vehicle licence period of the multijurisdictional vehicle.

Subsection 77(4) provides that any refund under section 77 is, if the refund is in respect of tax paid under Division 7 of Part 3, limited to the tax paid that is attributable to the portion of the replacement vehicle's vehicle licence period that is wholly within

(a) the period during which the multijurisdictional vehicle is being repaired, and

(b) the vehicle licence period of the multijurisdictional vehicle.

Section 78 – Refund For Short Term Rental Vehicles

PST - SEC.78/Int.

References:

Act: Section 1 "multijurisdictional vehicle", "short term rental vehicle", "vehicle licence period"; Section 39; Part 3 – Division 7

Bulletin PST 135; Bulletin PST 400

Interpretation (Issued: 2013/11)

(a) a person paid tax under Division 7 [Multijurisdictional Vehicles] of Part 3 [Taxes in Relation to Tangible Personal Property] in relation to a multijurisdictional vehicle that

(i) is a short term rental vehicle, and

(ii) is leased, during a vehicle licence period, primarily to other persons who must pay tax under section 39 [tax on leases] in relation to the lease, and

(b) tax was levied and remitted as required under the Act in respect of tax payable under section 39 on the lease of the short term rental vehicle during the vehicle licence period,

the director must refund to the person the tax paid under Division 7 of Part 3 for that vehicle licence period in relation to the multijurisdictional vehicle.

Division 8 — Affixed Machinery and Improvements to Real Property

Section 79 – Contractor Exempt From Tax Under Section 37 Or 49

PST - SEC.79/Int.-R.1

References:

Act: Section 1 "affixed machinery", "improvement to real property”, “tangible personal property”, Section 11; Section 37; Section 49; Section 80; Section 80.61; Section 170

Bulletin PST 501

Interpretation (Issued: 2013/11; Revised: 2014/09, 2023/10)

Effective April 1, 2013, Bill 6, Budget Measures Implementation Act, 2022 amends section 79 by repealing and replacing the evidentiary requirements in paragraphs 79(1)(c) and (d) and 79(2)(c) and (d).

For a contractor to be exempt from tax under section 37 or 49, the new provisions require evidence, in the form described in section 80.61, that the contractor and their customer have agreed that the customer is liable for tax imposed under section 80 in relation to the tangible personal property.

These amendments respond to a 2021 court decision. For details, see PSTA/Sec. 80.61/Int.

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 amended section 79 to clarify that the exception rule for real property contractors may only be used in relation to real property contracts in BC.

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 79 the conditions that must be met by a contractor in order for the contractor to be exempt from tax imposed under section 37 [tax on purchase] and section 49 [tax if TPP brought into British Columbia for use] on TPP used to fulfill a contract.

The scheme set out under section 79 and section 80 [tax on TPP used to improve real property if contractor exempt] is commonly referred to as the "exception rule" for real property contractors. When a contractor operates under the exception rule, the contractor's customer must agree to pay tax. See PSTA/Sec. 79/R.1.

R.1 Application Of PST To Real Property Contracts (Issued: 2013/11; Revised 2014/09)

Under subparagraph (a)(viii) of the definition of "use", use includes the consumption, enjoyment or utilization of TPP for the purposes of fulfilling a contract for the supply and installation of affixed machinery or improvements to real property. Therefore, contractors are the taxable users of the TPP that they purchase in BC, bring or send into BC, or receive delivery of in BC, to fulfill contracts to supply and install affixed machinery or improvements to real property.

Contractors will ONLY be exempt from the obligation to pay tax on the TPP they use to fulfill a contract for the supply and installation of affixed machinery or improvements to real property in the following two circumstances:

As provided by section 79, the contractor and their customer have entered into an agreement, evidenced in writing, which specifically transfers the liability for the tax to the customer and sets out the purchase price for the TPP. If this is the case, the customer must pay tax under section 80 [tax on TPP used to improve real property if contractor exempt]. Additionally, under section 170 [contractor must be registered], a contractor must not supply TPP under an agreement referred to in paragraph 79(1)(c) or 79(2)(c) unless the contractor is registered under section 168 [registration] at the time the contractor supplies the TPP. For the purposes of the exemption in section 79, the real property that forms the subject of the agreement must be situated in BC.
As provided by section 80.1 [contractor exempt from tax under section 37 or 49 if other person would be exempt], the contractor has entered into a written contract with a customer who would be exempt from tax had that customer acquired the TPP used to fulfill the contract to supply and install affixed machinery or improvements to real property. This includes the Government of Canada, First Nations individuals and bands exempt under the Indian Act (Canada), and persons who qualify for certain exemptions under the Act (e.g., manufacturers).

Section 80 – Tax On Tangible Personal Property Used To Improve Real Property If Contractor Exempt

PST - SEC.80/Int.

References:

Act: Section 1 "affixed machinery", "improvement to real property"; Section 11; Section 28; Section 34; Section 37; Section 49; Section 79; Section 80.6; Section 80.7; Section 80.8; Section 170

Bulletin PST 104

Interpretation (Issued: 2013/11)

(a) the person has entered into the contract referred to in paragraph 79(1)(a) [contractor exempt from tax under section 37 or 49] or paragraph 79(2)(a) with a contractor in relation to the tangible personal property (i.e., the person, not the contactor, is responsible for the tax on tangible personal property used to in an improvement to real property), and

(b) the contractor is exempt from tax under section 79 imposed on the tangible personal property under section 37 [tax on purchase] or section 49 [tax if tangible personal property brought into British Columbia for use] in relation to the tangible personal property.

Subsection 80(2) provides that a person to whom section 80 applies must pay to the government tax on the purchase price of the tangible personal property at the applicable rate under section 34 [rates of tax in relation to purchase price].

Subsection 80(3) provides that if tax is paid under section 80 in respect of the tangible personal property, then no tax is payable in respect of that property under section 37 or section 49.

Section 28 [when tax is payable in respect of a purchase or lease] provides for when tax is payable under section 80.

Under section 170 [contractor must be registered], a contractor must not supply tangible personal property under an agreement referred to in paragraph 79(1)(c) or 79(2)(c) unless the contractor is registered under section 168 [registration] at the time the contractor supplies the tangible personal property.

Section 80.1 – Contractor Exempt From Tax Under Section 37 Or 49 If Other Person Would Be Exempt

PST - SEC.80.1/Int.-R.1

References:

Act: Section 1 "affixed machinery", "band", "First Nation individual", "improvement to real property", "vehicle"; Section 37; Section 49; Section 51; Section 80.4; Section 204

Bulletin PST 501

Interpretation (Issued: 2013/11; Revised: 2014/09)

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 amended section 80.1 to clarify the application of the real property contractor flow-through exemption.

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 80.1.

Section 80.1 provides the conditions that must be met by a contractor in order for the contractor to be exempt from tax imposed under section 37 [tax on purchase] or section 49 [tax if TPP brought into British Columbia for use] on TPP that will be used to fulfill a written contract (to supply and affix, or install, affixed machinery or improvements to real property) where the other party who entered into the contract with the contractor would have been exempt in respect of the TPP if they were to purchase the TPP or bring or send into BC, or receive delivery of in BC, the TPP.

Parties who would have been exempt include the Government of Canada, persons who qualify for certain exemptions under the Act (e.g., manufacturers), and First Nation individuals and bands that would be exempt if they were to purchase the TPP or bring or send into BC, or receive delivery of in BC, the TPP.

This provision allows for the other party’s eligibility for an exemption to "flow-through" to the contractor (i.e., the contractor is exempt from tax in respect of the tangible personal property).

R.1 Flow-Through Exemption For Treaty First Nations (Issued: 2014/09)

When a final agreement is reached under the treaty process, a treaty First Nation is no longer exempt under section 87 of the Indian Act (Canada). However, they become exempt from consumption taxes for 8 years under the terms of the final agreement. The flow-through exemption in section 80.1 and the related refund in section 80.2 [refund of tax paid by contractor under Division 5] are available to contractors in relation to treaty First Nations customers that are within the terms of their 8-year consumption tax exemption periods.

Section 80.2 – Refund Of Tax Paid By Contractor Under Division 5

PST - SEC.80.2/Int.

References:

Act: Section 1 "affixed machinery", "band", "First Nation individual", "improvement to real property”, “tangible personal property”; Part 3 – Division 5; Section 80.3; Section 80.61

PSTR: Section 20

Bulletin PST 501

Interpretation (Issued: 2013/11; Revised 2014/09; 2023/10)

Effective April 1, 2013, Bill 6, Budget Measures Implementation Act, 2022 amends section 80.2 by repealing and replacing the evidentiary requirements in paragraphs 80.2(1)(d) and (e).

For a contractor to be eligible for a refund of PST related to real property contracts where their customer would have been entitled to an exemption from paying the PST, the new provisions require evidence, in the form described in section 80.61, that the contractor and their customer have agreed that the customer is liable for tax imposed under section 80.3 in relation to the tangible personal property.

These amendments respond to a 2021 court decision. For details, see PSTA/Sec. 80.61/Int.

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 amended section 80.2 to clarify the application of the refund to contractors following the exception rule (such that it applies only in relation to real property contracts in BC) and to contractors performing work for First Nation individuals or bands.

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 80.2.

Section 80.2 provides authority for two different types of refunds to real property contractors who have paid tax under Division 5 [Property Brought into British Columbia from Outside Canada] of Part 3 [Taxes in Relation to Tangible Personal Property].

The first refund mirrors the exception rule exemption from section 79 [contractor exempt from tax under section 37 or 49] (see PSTA/Sec. 79/Int.).

The second refund applies to contractors performing work for specified parties, mirroring the exemptions in section 80.1 [contractor exempt from tax under section 37 or 49 if other person would be exempt] (see PSTA/Sec. 80.1/Int.).

Section 80.3 – Tax On Tangible Personal Property Used To Improve Real Property If Contractor Obtained Refund

PST - SEC.80.3/Int.

References:

Act: Section 1 "affixed machinery", "improvement to real property"; Section 11; Section 28; Section 34; Section 80.2; Section 80.7; Section 192

PSTR: Section 20; Section 79

Bulletin PST 104

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 80.3.

Section 80.3 is a taxing provision that works in tandem with section 80.2, and imposes tax on a contractor’s customer where the contractor obtained a refund under section 80.2 because the contractor and the customer have an agreement, evidenced in writing, that specifically states the customer is liable for the tax.

Subsection 80.3(1) provides that section 80.3 applies to a person in relation to tangible personal property if:

(a) the person has entered into the contract referred to in paragraph 80.2(1)(a) [refund of tax paid by contractor under Division 5] with a contractor in relation to the tangible personal property, and

(b) the contractor has obtained a refund under section 80.2 in relation to the tangible personal property.

Subsection 80.3(2) provides that a person to whom section 80.3 applies must pay to the government tax on the tangible personal property at the applicable rate under section 34 [rates of tax in relation to purchase price].

Subsection 80.3(3) provides that tax payable under subsection 80.3(2) must be paid

on or before the prescribed date (as provided under PSTR section 20 [prescribed date for section 80.3 of Act]; see PSTR/Sec. 20/Int.), and
in the prescribed manner (as provided under PSTR subsections 79(3) and 79(4) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Section 80.4 – Tax If Change Of Use Of Tangible Personal Property Used To Improve Real Property

PST - SEC.80.4/Int.

References:

Act: Section 1 "affixed machinery", "improvement to real property", "registrant"; Section 25; Section 34; Section 80.1; Section 80.2; Section 80.5; Section 192

PSTR: Section 43; Section 79

Bulletin PST 501

Interpretation (Issued: 2013/11; Revised: 2014/09)

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 amended section 80.4 to add references to section 80.5 [transitional tax on tangible personal property used by contractor to improve real property].

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 80.4.

Section 80.4 is a change in use taxing provision similar to the provisions in Division 9 [Change in Use] of Part 3 [Taxes in Relation to Tangible Personal Property], and imposes tax where a person benefitted from a specified exemption or refund because certain TPP was to be used for a particular purpose but the person who entered into the contract with the contractor subsequently uses that property, or allows that property to be used, for a taxable purpose.

Section 80.5 – Transitional Tax On Tangible Personal Property Used By Contractor To Improve Real Property

PST - SEC.80.5/Int.

References:

Act: Section 1 "affixed machinery", "band", "Excise Tax Act", "First Nation individual", "improvement to real property", "registrant”, “tangible personal property”; Section 11; Section 34; Section 37; Section 49; Section 55; Section 80.6; Section 80.61; Section 80.7; Section 80.8; Section 170; Section 192

PSTERR: Section 60.1

PSTR: Section 44; Section 79

Bulletin PST 501

Interpretation (Issued: 2013/11; Revised: 2014/09, 2023/10)

Effective April 1, 2013, Bill 6, Budget Measures Implementation Act, 2022 amends section 80.5 by repealing and replacing the evidentiary requirements in paragraphs 80.5(6)(a) and (b).

For a contractor to be exempt from tax under subsection 80.5(2), the new provisions require evidence, in the form described in section 80.61, that the contractor and their customer have agreed that the customer is liable for tax imposed under section 80.6 in relation to the tangible personal property.

These amendments respond to a 2021 court decision. For details, see PSTA/Sec. 80.61/Int.

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 amended section 80.5 to clarify the application of the exemption from transitional tax for contractors following the exception rule (such that it applies only in relation to real property contracts in BC) and to add an exemption for contractors performing work for parties who would otherwise be exempt from tax under the Act.

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 80.5.

Section 80.5 is a transitional taxing provision that imposes tax on TPP acquired before April 1, 2013 that is used for the purpose of fulfilling a contract under which the contractor is required to supply and affix, or install, affixed machinery or improvements to real property on or after April 1, 2013, unless a specific exemption applies. This ensures a consistent tax treatment for TPP used to improve real property on or after April 1, 2013, regardless of what TPP is being used to fulfill the contract.

This provision ensures that large real property contractors who have more capacity to stockpile goods for which they have received input tax credits do not have an unfair advantage over smaller-scale contractors. It also ensures that real property contractors do not have preferential treatment compared to property owners who choose to undertake their own home improvements.

For example, a roofing contractor (HST registrant) has a contract to install a new roof on a building. The roofing contractor purchases replacement shingles on March 25, 2013 and installs them on the building on or after April 1, 2013.

Tax will apply to the purchase price of the replacement shingles because they were used to improve real property on or after April 1, 2013 and none of the taxes specified under subsection 80.5(3) apply.

The tax payable under section 80.5 is reduced by the PST, social service tax and provincial component of the HST previously paid on the TPP, provided that the contractor has not obtained and is not entitled to obtain a refund, rebate or credit, including input tax credits.

Section 80.5 also provides for exemptions mirroring the exception rule exemption from section 79 [contractor exempt from tax under section 37 or 49] (see PSTA/Sec. 79/Int.) and the exemptions that apply to contractors performing work for specified parties found in section 80.1 [contractor exempt from tax under section 37 or 49 if other person would be exempt] (see PSTA/Sec. 80.1/Int.).

Section 80.6 – Transitional Tax On Tangible Personal Property Used To Improve Real Property

PST - SEC.80.6/Int.

References:

Act: Section 1 "Excise Tax Act"; Section 11; Section 28; Section 34; Section 80; Section 80.5; Section 80.7; Section 80.8; Section 170; Section 179

Bulletin PST 104

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 80.6.

Section 80.6 is a transitional taxing provision that works in tandem with section 80.5, and imposes tax on a contractor’s customer where the contractor was exempt from the transitional tax under section 80.5 because the contractor and the customer have an agreement, evidenced in writing, that specifically states the customer is liable for the tax.

The tax payable under section 80.6 is reduced by the PST, social service tax and provincial component of the HST previously paid on the tangible personal property by the person or contractor, provided that the person or contractor has not obtained and is not entitled to obtain a refund, rebate or credit, including input tax credits.

Subsection 80.6(1) provides that section 80.6 applies to a person in relation to tangible personal property if:

(a) the person has entered into the contract referred to in paragraph 80.5(1)(b) [transitional tax on tangible personal property used by contractor to improve real property] with a contractor,

(b) the contractor uses the tangible personal property so that it ceases to be personal property at common law, and

(c) the contractor is exempt under subsection 80.5(6) from tax imposed under subsection 80.5(2) in relation to the tangible personal property.

Subsection 80.6(2) provides that a person to whom section 80.6 applies must pay to the government tax on the on the purchase price of the tangible personal property at the applicable rate under section 34 [rates of tax in relation to purchase price].

Subsection 80.6(3) provides that the amount of tax payable under subsection 80.5(2) by a person in relation to tangible personal property is reduced by the total of the following:

(a) the amount of tax under section 80 [tax on tangible personal property used to improve real property if contractor exempt] payable or previously paid by the person in relation to the tangible personal property and for which the person has not obtained and is not entitled to obtain a refund under the Act;

(b) the amount of tax under the Social Service Tax Act previously paid by the person or the contractor in relation to the tangible personal property and for which the person or the contractor has not obtained and is not entitled to obtain a refund under that Act;

(c) the amount of tax under section 165(2), 212.1 or 218.1 or Division IV.1 of Part IX of the Excise Tax Act, in respect of British Columbia as a participating province under Part IX of that Act, previously paid by the person or the contractor in relation to the tangible personal property and for which the person or the contractor has not obtained and is not entitled to obtain a refund, credit or rebate under Part IX of that Act.

Subsection 80.6(4) provides that the tax payable under subsection 80.6(2) must be paid on or before the last day of the month after the month in which the contractor uses the tangible personal property in a manner such that the tangible personal property ceases to be personal property at common law.

Section 80.61 - Evidence For Purposes Of Sections 79, 80.2 And 80.5

PSTA - Sec.80.61/Int.

References:

Act: Section 1 “director”, “purchase price”, “tangible personal property”; Part 3 – Division 8; Section 79; Section 80; Section 80.2; Section 80.3; Section 80.5; Section 80.6

Bulletin PST 501

Interpretation (Issued: 2023/10)

Effective April 1, 2013, Bill 6, Budget Measures Implementation Act, 2022 adds section 80.61, consequential to the removal of the evidentiary requirements from sections 79, 80.2 and 80.5. Section 80.61 now contains the evidentiary requirements for each of those sections.

These amendments address a BC Court of Appeals judgment (Chemainus Gardens RV Resort Ltd. v. British Columbia (Attorney General), 2021 BCCA 402). The judgment found that a reference to tax imposed under a specific section was not needed to transfer PST liability from the contractor to their customer. These amendments use clearer legislative language to reinstate that evidentiary requirement, while providing contractors and their customers with more options that are substantially aligned with the previous rules. Without these amendments, the 2021 judgment would have required ministry staff to make subjective decisions to determine whether the contractor or their customer was required to pay PST.

Subsection 80.61(1) provides that for the purposes of subsections 79(1) and (2), 80.2(1), and 80.5(6), evidence that the contractor and their customer have agreed that the customer is liable for PST in relation to the tangible personal property must be in the form of one of the following:

(a) A signed agreement between the parties that

(i) sets out the purchase price of the tangible personal property,

(ii) expressly identifies the particular provision of this Act under which the tax is imposed (i.e. section 80, 80.3 or 80.6), and

(iii) expressly states that the customer is liable for the tax

(b) An invoice signed by the parties that

(i) lists the tangible personal property,

(ii) expressly identifies the particular provision of this Act under which the tax is imposed (i.e. section 80, 80.3 or 80.6), and

(iii) expressly states that the customer is liable for the tax

(c) A declaration in a form acceptable to the director that the parties have agreed that the customer is liable for the tax (i.e. completing a Declaration of Agreement to Pay PST (FIN 488))

Paragraph 80.61(1)(c) addresses situations where contractors and their customers intended to have the customer pay the PST, but they did not produce evidence in the precise form contemplated by these requirements. The parties may complete a FIN 488 to rectify situations where a contract or invoice unintentionally falls short of the requirements in paragraphs 80.61(1)(a) or (b).

Subject to subsection 80.61(3), subsection 80.61(2) provides that any document other than a document described in subsection 80.61(1) does not constitute evidence that the contractor and their customer have agreed that the customer is liable for PST in relation to the tangible personal property.

Subsection 80.61(3) provides an exception for contracts referred to in Part 3 – Division 8 entered between April 1, 2013 and February 22, 2022. For such a contract, evidence that the director agrees is substantially similar to the evidence described in subsection 80.61(1) constitutes evidence that the contractor and their customer have agreed that the customer is liable for PST in relation to the tangible personal property.

Section 80.7 – Transitional Tax On Tangible Personal Property Incorporated Into Property Subject To Tax Under New Housing Transition Tax And Rebate Act

PST - SEC.80.7/Int.

References:

Act: Section 1 "affixed machinery", "Excise Tax Act", "improvement to real property", "registrant"; Section 34; Section 37; Section 49; Section 55; Section 80; Section 80.3; Section 80.5; Section 80.6; Section 192

PSTR: Section 45; Section 79

Bulletin PST 104

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 80.7.

Section 80.7 is a transitional taxing provision that imposes tax if a person:

purchased in BC, brought or sent into BC or received delivery of BC, tangible personal property, and
the tangible personal property is incorporated into real property that could be the subject matter of a taxable sale or taxable self-supply as described in the New Housing Transition Tax and Rebate Act.

The tax payable under section 80.7 is reduced by the PST, social service tax and provincial component of the HST previously paid on the tangible personal property by the person or contractor, provided that the person or contractor has not obtained and is not entitled to obtain a refund, rebate or credit, including input tax credits.

The tax and rebate scheme are designed to ensure there is no double taxation on the tangible personal property.

Effective April 1, 2015, Section 80.7 is repealed by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 to coincide with the repeal of the New Housing Transition Tax and Rebate Act on the same date.

Subsection 80.7(1) provides that in section 80.7,

"taxable sale" has the same meaning as in the New Housing Transition Tax and Rebate Act if that Act were read without reference to subsections 1(2) and 1(3);

"taxable self-supply" has the same meaning as in the New Housing Transition Tax and Rebate Act if that Act were read without reference to subsection 1(3).

Subsection 80.7(2) provides that subject to subsection 80.7(3), section 80.7 applies to a person in relation to tangible personal property if

(a) the person

(i) purchased the tangible personal property at a sale in British Columbia, or

(ii) brought or sent into British Columbia, or received delivery of in British Columbia, the tangible personal property, and

(b) the tangible personal property is incorporated into property that could be the subject matter of a taxable sale or taxable self-supply.

Subsection 80.7(3) provides that section 80.7 does not apply to a person if the person sells the tangible personal property to another person before that tangible personal property is incorporated into property that could be the subject matter of a taxable sale or taxable self-supply.

Subsection 80.7(4) provides that a person to whom section 80.7 applies must pay to the government tax on the purchase price of the tangible personal property at the applicable rate under section 34 [rates of tax in relation to purchase price].

Subsection 80.7(5) provides that the amount of tax payable under subsection 80.7(4) by a person in relation to tangible personal property is reduced by the total of the following:

(a) the amount of tax under section 37 [tax on purchase], section 49 [tax if tangible personal property brought into British Columbia for use], section 55 [tax if property brought into British Columbia from outside Canada], section 80 [tax on tangible personal property used to improve real property if contractor exempt], section 80.3 [tax on tangible personal property used to improve real property if contractor obtained refund], section 80.5 [transitional tax on tangible personal property used by contractor to improve real property] and section 80.6 [transitional tax on tangible personal property used to improve real property] payable or previously paid by the person in relation to the tangible personal property and for which the person has not obtained and is not entitled to obtain a refund under the Act;

(b) the amount of tax under the Social Service Tax Act previously paid by the person in relation to the tangible personal property and for which the person has not obtained and is not entitled to obtain a refund under that Act;

(c) the amount of tax under section 165(2), 212.1 or 218.1 or Division IV.1 of Part IX of the Excise Tax Act, in respect of British Columbia as a participating province under Part IX of that Act, previously paid by the person in relation to the tangible personal property and for which the person has not obtained and is not entitled to obtain a refund, credit or rebate under Part IX of that Act.

Subsection 80.7(6) provides that the tax payable under subsection 80.7(4) must be paid on or before the last day of the month after the month in which the tangible personal property is incorporated into the property referred to in paragraph 80.7(2)(b).

Subsection 80.7(7) provides that despite subsection 80.7(6), tax payable under subsection 80.7(4) by a registrant must be paid

on or before the prescribed date (as provided under PSTR section 45 [section 80.7 of Act – transitional tax on tangible personal property incorporated into property subject to tax under New Housing Transition Tax and Rebate Act]; see PSTR/Sec. 45/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Section 80.8 – Transitional Tax On Mobile Homes Affixed To Land Situated In British Columbia

PST - SEC.80.8/Int.

References:

Act: Section 1 "affixed machinery", "Excise Tax Act", "improvement to real property", "registrant"; Section 37; Section 49; Section 55; Section 80; Section 80.5; Section 80.6; Section 192

PSTR: Section 46; Section 79

Bulletin PST 104

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 80.8.

Section 80.8 is a transitional taxing provision that applies to mobile homes acquired or manufactured before April 1, 2013 and affixed to land in British Columbia on or after April 1, 2013 for residential use. This provision prevents a gap in taxation as the mobile homes described in this provision will not be subject to the New Housing Transition Tax and Rebate Act, unlike other mobile homes which are affixed to land before April 1, 2013. The rate of tax is 7% of 50% of the purchase price of the mobile home, which is the standard rate applicable under the Act to mobile homes.

Subsection 80.8(1) provides that in section 80.8, "mobile home" has the same meaning as in Part IX of the Excise Tax Act.

Subsection 80.8(2) provides that section 80.8 applies to a person in relation to a mobile home if,

(a) before April 1, 2013, the person acquired or manufactured a mobile home, and

(b) on or after April 1, 2013, the mobile home is, by or on behalf of the person, affixed to land situated in British Columbia for the purpose of use and enjoyment of the mobile home as a place of residence for an individual within the meaning of Part IX of the Excise Tax Act.

Subsection 80.8(3) provides that a person to whom section 80.8 applies must pay to the government tax on the mobile home at the rate of 7% of the amount equal to 50% of the purchase price of the mobile home.

Subsection 80.8(4) provides that the amount of tax payable under subsection 80.8(3) by a person in relation to a mobile home is reduced by the total of the following:

(a) the amount of tax under section 37 [tax on purchase], section 49 [tax if tangible personal property brought into British Columbia for use], section 55 [tax if property brought into British Columbia from outside Canada], section 80 [tax on tangible personal property used to improve real property if contractor exempt], section 80.5 [transitional tax on tangible personal property used by contractor to improve real property] and section 80.6 [transitional tax on tangible personal property used to improve real property] payable or previously paid by the person in relation to the mobile home and for which the person has not obtained and is not entitled to obtain a refund under the Act;

(b) the amount of tax under the Social Service Tax Act previously paid by the person in relation to the mobile home and for which the person has not obtained and is not entitled to obtain a refund under that Act;

(c) the amount of tax under section 165(2), 212.1 or 218.1 or Division IV.1 of Part IX of the Excise Tax Act in respect of British Columbia as a participating province under Part IX of that Act, previously paid by the person in relation to the mobile home and for which the person has not obtained and is not entitled to obtain a refund, credit or rebate under Part IX of that Act.

Subsection 80.8(5) provides that the tax payable under subsection 80.8(3) must be paid on or before the last day of the month after the month in which the mobile home is affixed to land as referred to in paragraph 80.8(2)(b).

Subsection 80.8(6) provides that despite subsection 80.8(5), tax payable under subsection 80.8(3) by a registrant must be paid

on or before the prescribed date (as provided under PSTR section 46 [section 80.8 of Act – transitional tax on mobile homes affixed to land situated in British Columbia]; see PSTR/Sec. 46/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Division 9 — Change in Use

Section 81 – Tax If Change In Use Of Property Acquired For Resale

PST - SEC.81/Int.

References:

Act: Section 1 "conveyance", "registrant", "user"; Section 34; Section 59; Section 64; Section 84.1; Section 192

PSTR: Section 47; Section 79

Bulletin PST 208

Interpretation (Issued: 2013/11; Revised: 2016/01)

Effective April 1, 2013, Bill 13, Finance Statutes Amendment Act, 2015 amended section 81(2) to specifically include references to "taxable conveyance." Because "taxable conveyance" as defined in Section 59 includes a conveyance part, the amendment ensures that parts for a conveyance are taxed according to the prorated formula for conveyances used inside and outside of British Columbia.

Subsection 81(1) provides that if a person purchased in British Columbia, brought or sent into British Columbia, or received delivery of in British Columbia, tangible personal property for resale and becomes, for any period, a user of that property, the person must pay to the government tax on the purchase price of that property at the applicable rate under section 34 [rates of tax in relation to purchase price].

Subsection 81(1.1) provides that subsection 81(1) does not apply to a person if, when the person becomes a user of the tangible personal property, the tangible personal property is used for a purpose for which the tangible personal property would have been exempt from tax under the Act if the property were to be used for that purpose when the person purchased in British Columbia, brought or sent into British Columbia or received delivery of in British Columbia that tangible personal property.

Subsection 81(2) provides that subsection 81(1) does not apply to a person in respect of a conveyance if section 64 [tax if change in use of conveyance acquired for resale] applies to the person in respect of the conveyance.

Subsection 81(3) provides that tax payable under subsection 81(1) must be paid on or before the last day of the month after the month in which the person first becomes a user of the tangible personal property.

Subsection 81(4) provides that despite subsection 81(3), tax payable under subsection 81(1) by a registrant must be paid

on or before the prescribed date (as provided under PSTR section 47 [section 81 of Act – tax if change in use of property acquired for resale]; see PSTR/Sec. 47/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Section 82 – Tax If Property Used For New Purpose

PST - SEC.82/Int.-R.1

References:

Act: Section 1 "registrant"; Section 25; Section 34; Section 84.1; Section 87; Section 102; Section 142; Section 192

PSTERR: Section 22

PSTR: Section 48; Section 79

Bulletin PST 315

Interpretation (Issued: 2013/11; Revised: 2014/09)

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 amended section 82 to correct a reference.

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 82 the change of use taxing provision that applies when a person received an exemption under the Act in respect of TPP (other than leased TPP) because the TPP was to be used for a particular purpose, but the person subsequently uses that property, or allows that property to be used, for a non-exempt purpose.

R.1 Exempt TPP Used By A Non-Qualifying Farmer For A Farm Purpose (Issued: 2014/04)

TPP purchased exempt from tax by a "qualifying farmer" may be used by a non-qualifying farmer without it becoming subject to PST, provided that the qualifying farmer retains ownership and the TPP is used for a farm purpose. For example, a qualifying farmer may hire a third-party to operate their farm using the qualifying farmer's equipment. As long as the qualifying farmer retains ownership of the equipment, the third-party may use it in the operation of the farm without the equipment becoming subject to PST.

Section 82 imposes PST where TPP that was obtained for a farm purpose PST-exempt is used or permitted to be used for a non-farm purpose (other than another exempt purpose). There is no provision under the Act imposing PST where a qualifying farmer who purchased TPP allows it to be used for a farm purpose by a person who is not a qualifying farmer.

Section 82.01 - Tax if Leased Property Used for New Purpose

PST - SEC.82.01/Int.

References:

Act: Section 1 "lease"; "registrant"; Section 13; Section 35; Section 192

PSTR: Section 48.1; Section 79

Bulletin PST 315

Interpretation (Issued: 2014/09)

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 provides under section 82.01 the change of use taxing provision that applies when a person received an exemption under the Act in respect of leased TPP because the TPP was to be used for a particular purpose, but the person subsequently uses that property, or allows that property to be used, for a non-exempt purpose.

Tax imposed under section 82.01 must be self-assessed.

Section 82.1 – Tax On Parts Or Material If Property Containing Parts Or Material Used For New Purpose

PST - SEC.82.1/Int.

References:

Act: Section 1 "registrant"; Section 25; Section 34; Section 192

PSTERR: Section 40; Section 46; Section 48; Section 49; Section 108

PSTR: Section 21; Section 49; Section 79

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 82.1.

In certain situations, parts and materials are exempt because they are to be used with exempt tangible personal property. Section 82.1 provides the change of use taxing provision that applies when the parts and materials were exempt because they were to be used for the exempt purposes applicable to the provisions prescribed under PSTR section 21 [prescribed provisions for section 82.1 of Act], but the person subsequently uses that property, or allows that property to be used, for a non-exempt purpose.

Subsection 82.1(1) provides that section 82.1 applies to a person in relation to tangible personal property that is a part or material if the person

(a) purchased in British Columbia, brought or sent into British Columbia, or received delivery of in British Columbia, the part or material exempt under a prescribed provision of the regulations from tax under the Act because the part or material is to be used in relation to tangible personal property that would be exempt from tax under the Act if the tangible personal property were to be used for a particular purpose, and

(b) subsequently uses that tangible personal property, or allows that tangible personal property to be used, for a purpose other than

(i) the particular purpose, or

(ii) another purpose for which the part or material would be exempt from tax under the Act if that tangible personal property were to be used for that purpose.

Currently, under PSTR section 21, the following provisions are prescribed for the purposes of paragraph 82.1(1)(a):

(a) PSTERR subsection 40(3) [printers and publishers];

(b) PSTERR subsection 46(3) [ farmers];

(d) PSTERR subsection 49(3) [aquaculturists];

(e) PSTERR section 108 [parts and materials] (PM&E exemption).

Subsection 82.1(2) provides that a person to whom section 82.1 applies must pay to the government tax on the purchase price of the part or material at the applicable rate under section 34 [rates of tax in relation to purchase price].

Subsection 82.1(3) provides that tax payable under subsection 82.1(2) must be paid on or before the last day of the month after the month in which the person first uses the tangible personal property, or allows the tangible personal property to be used, as referred to in paragraph 82.1(1)(b).

Subsection 82.1(4) provides that despite subsection 82.1(3), tax payable under subsection 82.1(2) by a registrant must be paid

on or before the prescribed date (as provided under PSTR section 49 [section 82.1 of Act – tax on parts or material if property containing parts or material used for new purpose]; see PSTR/Sec. 49/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Section 82.2 – Tax If Conditions For Exemption Not Maintained For Specified Period

PST - SEC.82.2/Int.

References:

Act: Section 1 "registrant"; Section 25; Section 34; Section 192

PSTERR: Section 149; Section 151; Section 152

PSTR: Section 22; Section 50; Section 79

Bulletin PST 210

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 82.2.

Section 82.2 provides the taxing provision that applies when a person who received an exemption under a prescribed provision of the regulations was unable to maintain the required specified conditions of the exemption for a specified period.

Currently, section 82.2 only applies when a person transfers tangible personal property exempt of tax under the related party provisions provided by PSTERR section 149 [tangible personal property transferred between related corporations], PSTERR section 151 [tangible personal property transferred to new corporation – wholly owned and controlled] and PSTERR section 152 [tangible personal property transferred to new corporation – not wholly owned and controlled], and within 8 months of that transfer, the relationship requirements provided by those provisions are no longer met.

Subsection 82.2(1) provides that section 82.2 applies to a person in relation to tangible personal property if

(a) the person purchased in British Columbia, brought or sent into British Columbia, or received delivery of in British Columbia tangible personal property that was exempt under a prescribed provision of the regulations from tax under the Act,

(b) the prescribed provision of the regulations requires specified conditions to be maintained for a specified period, and

Currently, under PSTR section 22 [prescribed provisions for section 82.2 of Act], the following provisions are prescribed for the purposes of paragraph 82.2(1)(a):

(a) PSTERR section 149;

(b) PSTERR section 151;

Subsection 82.2(2) provides that the person to whom section 82.2 applies must pay to the government tax on the purchase price of the tangible personal property at the applicable rate under section 34 [rates of tax in relation to purchase price].

Subsection 82.2(3) provides that tax payable under subsection 82.2(2) must be paid on or before the last day of the month after the month in which the conditions referred to in subsection 82.2(1) are not maintained.

Subsection 82.2(4) provides that despite subsection 82.2(3), tax payable under subsection 82.2(2) by a registrant must be paid

on or before the prescribed date (as provided under PSTR section 50 [section 82.2 of Act – tax if conditions for exemption not maintained for specified period]; see PSTR/Sec. 50/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Section 82.3 – Tax If Change In Use Of Vehicle, Boat Or Aircraft Exempt From Tax Under Consumption Tax Rebate And Transition Act

PST - SEC.82.3/Int.

References:

Act: Section 1 "registrant"; Section 25; Section 34; Section 192

PSTR: Section 51; Section 79

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 82.3.

Section 82.3 provides the change of use taxing provision that applies when a person who received an exemption on designated property under the Consumption Tax Rebate and Transition Act subsequently uses that property for a non-exempt purpose.

The Consumption Tax Rebate and Transition Act is repealed effective April 1, 2013. Therefore, the change in use provision under that Act is incorporated under the Provincial Sales Tax Act to ensure that tax is payable when a vehicle, boat or aircraft that was acquired for an exempt use is subsequently used for a non-exempt purpose.

Subsection 82.3(1) provides that in section 82.3, "designated property" has the same meaning as in the Consumption Tax Rebate and Transition Act, as that Act read on March 31, 2013.

Subsection 82.3(2) provides that section 82.3 applies to a person in relation to tangible personal property that is designated property if the person

(a) purchased in British Columbia, brought or sent into British Columbia, or received delivery of in British Columbia the designated property in respect of which tax was not payable under the Consumption Tax Rebate and Transition Act, other than by reason of an exemption under section 26 [exempt from tax] of that Act, and

(b) subsequently uses that property, or allows that property to be used, for a purpose other than a purpose for which that property would be exempt from tax under the Provincial Sales Tax Act if that property were to be used for that purpose.

Subsection 82.3(3) provides that a person to whom section 82.3 applies must pay to the government tax on the purchase price of the designated property at the applicable rate under section 34 [rates of tax in relation to purchase price].

Subsection 82.3(4) provides that tax payable under subsection 82.3(3) must be paid on or before the last day of the month after the month in which the person first uses the property, or allows the property to be used, as referred to in paragraph 82.3(2)(b).

Subsection 82.3(5) provides that despite subsection 82.3(4), tax payable under subsection 82.3(4) by a registrant must be paid

on or before the prescribed date (as provided under PSTR section 51 [section 82.3 of Act – tax if change in use of vehicle, boat or aircraft exempt from tax under Consumption Tax Rebate and Transition Act]; see PSTR/Sec. 51/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Section 83 – Tax If Change In Use Of Property Acquired For Lease

PST - SEC.83/Int.

References:

Act: Section 1 "registrant"; Section 25; Section 34; Section 102; Section 142; Section 192

PSTR: Section 52; Section 79

Bulletin PST 315

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 83 the change of use taxing provision that applies when tangible personal property acquired by a person exempt from tax under subsection 142(4) or (5) [exemptions for tangible personal property intended for lease] as lease inventory is no longer capitalized as lease inventory in the purchaser’s business accounting records (i.e., the person removes the property from their lease inventory).

Subsection 83(1) provides that if a person

(a) purchased in British Columbia, brought or sent into British Columbia, or received delivery of in British Columbia, tangible personal property that was exempt from tax under subsection 142(4) or subsection 142(5), and

(b) subsequently ceases to capitalize that property as lease inventory in the person’s business accounting records,

the person must pay to the government tax on the purchase price of that property at the applicable rate under section 34 [rates of tax in relation to purchase price].

Subsection 83(2) provides that tax payable under subsection 83(1) must be paid on or before the last day of the month after the month in which the person first ceases to capitalize that property as lease inventory in the person’s business accounting records.

Subsection 83(3) provides that despite subsection 83(2), tax payable under subsection 83(1) by a registrant must be paid

on or before the prescribed date (as provided under PSTR section 52 [section 83 of Act – tax if change in use of property acquired for lease]; see PSTR/Sec. 52/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Section 84 – Tax If Change In Use Of Resulting Tangible Personal Property

PST - SEC.84/Int.

References:

Act: Section 1 "registrant", "user"; Section 25; Section 34; Section 84.1; Section 141; Section 192

PSTR: Section 53; Section 79

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 84 the change of use taxing provision that applies when tangible personal property was acquired by a person exempt from tax under paragraph 142(1)(a) or 142(1)(b) [exemptions in relation to industry and commerce] because the tangible personal property was to be manufactured into or incorporated into other tangible personal property for retail sale or lease, and that person subsequently becomes the user of that resulting tangible personal property.

Subsection 84(1) provides that if a person

(b) becomes, for any period, a user of the tangible personal property to which the tangible personal property referred to in paragraph 84(1)(a) is processed, fabricated or manufactured into, attached to or incorporated into,

the person must pay to the government tax on the purchase price of the tangible personal property referred to in paragraph 84(1)(a) at the applicable rate under section 34 [rates of tax in relation to purchase price].

Subsection 84(2) provides that tax payable under subsection 84(1) must be paid on or before the last day of the month after the month in which the person first becomes a user of the tangible personal property first mentioned in paragraph 84(1)(b).

Subsection 84(3) provides that despite subsection 84(2), tax payable under subsection 84(1) by a registrant must be paid

on or before the prescribed date (as provided under PSTR section 53 [section 84 of Act – tax if change in use of resulting tangible personal property]; see PSTR/Sec. 53/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Section 84.1 – Tax If Dealer Or Manufacturer Changes Use Of Motor Vehicle

PST - SEC.84.1/Int.-R.1

References:

Act: Section 1 "month", "motor vehicle"; Section 34; Section 81; Section 82; Section 84; Section 141; Section 192; Section 238

PSTR: Section 25; Section 26; Section 27; Section 28; Section 79

Bulletin PST 317

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 added section 84.1.

Section 84.1 provides the change of use taxing provision that applies when dealers and manufacturers of motor vehicles use motor vehicles acquired for sale or lease for certain business purposes.

Under the dealer use/manufacturer use formulas, dealers and manufacturers of motor vehicles who use motor vehicles acquired for sale or lease for certain business purposes pay a monthly tax based on the number of vehicles used for those certain business purposes relative to their total inventory, rather than paying full tax on the vehicles under the general change in use charging provisions under section 81 [tax if change in use of property acquired for resale] or section 83 [tax if change in use of property acquired for lease].

Subsection 84.1(1) provides that in section 84.1,

"dealer" means a person who is registered as a motor dealer under the Motor Dealer Act;

"eligible use" means a use referred to in subparagraphs (a)(ii) and (a)(iii) of the definition of "use";

"manufacturer" means a person who makes motor vehicles but does not include a dealer.

Subsection 84.1(2) provides that if a dealer purchased in British Columbia, brought or sent into British Columbia or received delivery of in British Columbia a prescribed motor vehicle (PSTR subsection 26(2) [change in use of motor vehicle by dealer]) for resale or for the purpose of leasing the motor vehicle to other persons and, in a month, uses that motor vehicle in British Columbia only for a prescribed use (PSTR subsection 26(3)), in addition to an eligible use, the dealer must pay to the government tax calculated in accordance with the regulations.

Subsection 84.1(3) provides that if a dealer in a month uses only for a prescribed use (PSTR subsection 26(3)), in addition to an eligible use, a prescribed motor vehicle (PSTR subsection 26(2)) into which tangible personal property exempt from tax under paragraph 141(1)(a) [exemptions in relation to industry and commerce] has been processed, fabricated, manufactured or incorporated, or to which tangible personal property exempt from tax under that section has been attached, the dealer must pay to the government tax calculated in accordance with the regulations (PSTR section 26).

Subsection 84.1(4) provides that if a manufacturer brought or sent into British Columbia, or received delivery of in British Columbia, a prescribed motor vehicle (PSTR subsection 27(1) [change in use of motor vehicle by manufacturer]) for sale or for the purpose of leasing the motor vehicle to other persons and, in a month, uses that motor vehicle in British Columbia only for a prescribed use (PSTR subsection 27(2)), in addition to an eligible use, the manufacturer must pay to the government tax calculated in accordance with the regulations (PSTR section 27).

Subsection 84.1(5) provides that if a manufacturer in a month uses only for a prescribed use (PSTR subsection 27(2)), in addition to an eligible use, a prescribed motor vehicle (PSTR subsection 27(1)) into which tangible personal property exempt from tax under paragraph 141(1)(a) has been processed, fabricated, manufactured or incorporated, or to which tangible personal property exempt from tax under that section has been attached, the manufacturer must pay to the government tax calculated in accordance with the regulations (PSTR section 27).

Subsection 84.1(6) provides that tax payable under subsections 84.1(2) to 84.1(5) must be paid

on or before the prescribed date (as provided under PSTR section 28 [prescribed date for section 84.1 of Act]; see PSTR/Sec. 28/Int.), and
in the prescribed manner (as provided under PSTR subsections 79(3) and 79(4) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Subsection 84.1(7) provides that a dealer or manufacturer who must pay tax under subsection 84.1(2) or subsection 84.1(4) is exempt from tax imposed under section 81 or section 82 [tax if property used for new purpose] in relation to the use of the motor vehicle that is subject to tax under section 84.1.

Subsection 84.1(8) provides that a dealer or manufacturer who must pay tax under subsection 84.1(3) or subsection 84.1(5) is exempt from tax imposed under section 84 [tax if change of use of resulting tangible personal property] in relation to the use of the motor vehicle that is subject to tax under section 84.1.

R.1 Automobile Wholesalers (Issued: 2014/04)

To qualify for the dealer-use formulas, the company must be registered as a motor dealer under the Motor Dealer Act, and the vehicles must be readily available for sale to the public. Automobile wholesalers are not registered as motor dealers under the Motor Dealer Act, and their vehicles are not readily available for sale to the public. Accordingly, wholesalers are required to pay tax on the full purchase price of any vehicles taken out of their resale inventory for business use (e.g., as a "company car" or for an employee).

Section 85 – Tax If Change In Use Of Prototype

PST - SEC.85/Int.

References:

Act: Section 1 "prototype", "registrant", "user"; Section 25; Section 34; Section 141; Section 192

PSTR: Section 54; Section 79

Bulletin PST 209

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 85 the change in use taxing provision that applies when a person received an exemption under paragraph 141(1)(d) or 141(1)(e) [exemptions in relation to industry and commerce] in respect of a prototype, and that person subsequently uses that prototype or receives consideration for the use of that prototype.

Subsection 85(1) provides that if a person:

(a) purchased in British Columbia, or brought or sent into British Columbia, or received delivery of in British Columbia, tangible personal property that was exempt from tax under paragraph 141(1)(d) or 141(1)(e), and

(b) for any period after the testing of the prototype or copy of the prototype referred to under paragraph 141(1)(d) or 141(1)(e),

(i) becomes the user of that prototype or copy of that prototype, or

(ii) becomes entitled to receive consideration for use of that prototype or copy of that prototype,

the person must pay to the government tax on the purchase price of that tangible personal property at the applicable rate under section 34 [rates of tax in relation to purchase price].

Subsection 85(2) provides that subsection 85(1) does not apply if the only use of the prototype or copy of the prototype is for demonstration and the only consideration received for the use of the prototype or copy of the prototype does not exceed the actual cost of that demonstration.

Subsection 85(3) provides that tax payable under subsection 85(1) must be paid on or before the last day of the month after the month in which the earliest of the following occurs:

(a) the person first becomes a user of the prototype or copy of the prototype;

(b) the consideration for use of the prototype or copy of the prototype is paid;

Subsection 85(4) provides that despite subsection 85(3), tax payable under subsection 85(1) by a registrant must be paid

on or before the prescribed date (as provided under PSTR section 54 [section 85 of Act – tax if change in use of prototype]; see PSTR/Sec. 54/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Section 86 – Tax If Change In Use Of Property For Which Refund Received Under Taxation Agreement

PST - SEC.86/Int.

References:

Act: Section 25; Section 34; Section 35; Section 155; Section 156; Section 192

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 86 the change in use taxing provision that applies when a person who has received a refund of tax paid on tangible personal property under section 155 [refund in accordance with Nisga’a Nation Taxation Agreement] or section 156 [refund in accordance with treaty first nation tax treatment agreement] subsequently uses that property, or allows that property to be used, for a non-refundable or non-exempt purpose.

Subsection 86(1) provides that if a person:

(a) received a refund of tax under section 155 or section 156 in relation to tangible personal property, and

(b) subsequently uses that property, or allows that property to be used, for a purpose other than

(i) a purpose that would entitle the person to receive a refund of tax under section 155 or section 156, or

(ii) another purpose for which that property would be exempt from tax under the Act if that property were to be used for that purpose.

the person must pay to the government tax on the purchase price or lease price, as the case may be, at the applicable rate under section 34 [rates of tax in relation to purchase price] or section 35 [rates of tax in relation to lease price].

Subsection 86(2) provides that tax payable under subsection 86(1) must be paid on or before the last day of the month after the month in which the person first uses that property, or allows that property to be used, as referred to in paragraph 86(1)(b).

Section 87 – Tax If Recording Exhibited

PST - SEC.87/Int.

References:

Act: Section 1 "registrant"; Section 82; Section 143; Section 192

PSTR: Section 55; Section 79

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 87 the taxing provision that applies when a person who acquired a recording of a motion picture exempt of tax under subparagraph 143(b)(ii) [exemption in relation to recording of motion picture or audio production] subsequently exhibits that motion picture in a movie theatre or other public venue.

Subsection 87(1) provides that a person:

(a) who brought or sent into British Columbia, received delivery of in British Columbia, purchased or leased, exempt from tax under subparagraph 143(b)(ii), tangible personal property that is a recording of a motion picture, and

(b) who exhibits the motion picture in a movie theatre or other public venue

must pay tax to the government in an amount equal to the amount of tax under the Act that would have otherwise been payable if the person had acquired the right or authority to exhibit the motion picture from a willing lessor acting in good faith in an arm’s length transaction in the open market.

Subsection 87(2) provides that tax payable under subsection 87(1) must be paid on or before the last day of the month after the month in which the motion picture is exhibited.

Subsection 87(3) provides that despite subsection 87(2), tax payable under subsection 87(1) by a registrant must be paid

on or before the prescribed date (as provided under PSTR section 55 [section 87 of Act – tax if recording exhibited]; see PSTR/Sec. 55/Int.), and
in the prescribed manner (as provided under PSTR subsection 79(2) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Section 88 – Tax If Leased Tangible Personal Property Becomes Part Of Real Property

PST - SEC.88/Int.

References:

Act: Section 1 "fair market value", "lessee", "retail sale"; Section 37; Section 142

Bulletin PST 315

Interpretation (Issued: 2013/11; Revised: 2017/05)

April 1, 2013, Bill 14, Finance Statutes Amendment Act, 2016 amended section 88 retroactively by adding a new subsection 88(5), to clarify that the deemed sale rule does not apply if the TPP becomes affixed machinery when is ceases to be personal property at common law.

The deemed sale rule is not required for leased TPP which becomes affixed machinery during the term of the lease because the lease of affixed machinery remains subject to PST even though it becomes part of real property.

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 amended section 88 to stipulate when tax payable in accordance with section 88 must be paid.

Section 88 is an anti-avoidance rule to ensure that tax is paid on leased TPP that becomes part of real property. Without this provision, a lessor could purchase the TPP exempt of tax under section 142(1), and during the term of the lease, the lessee could have avoided paying tax on the lease payments if the TPP becomes part of real property. Without this provision, no tax would be payable on that property.

Division 10 — Tangible Personal Property Acquired by Small Seller

Section 89 – Tax On Acquisition Of Eligible Tangible Personal Property

PST - SEC.89/Int.-R.1

References:

Act: Section 1 "eligible tangible personal property", "small seller"; Section 28; Section 37; Section 90; Section 141; Section 143; Section 161

PSTERR: Section 38; Section 39; Section 40; Section 59; Part 5 – Division 2; Part 5 – Division 3; Section 113; Section 117

Bulletin PST 003

Interpretation (Issued: 2013/11)

Generally, small sellers are persons who sell eligible tangible personal property, software or taxable services but do not regularly make sales from established commercial premises and who do not maintain business premises. To be a small seller, the person’s gross revenue from all retail sales of eligible tangible personal property, software and taxable services must be $10,000 or less per year.

Small sellers pay tax when they purchase goods for resale (as well as on other purchases) and do not charge tax to their customers.

Subsection 89(1) provides that a small seller who purchases, at a sale in British Columbia, eligible tangible personal property for resale must pay tax imposed under section 37 [tax on purchase] on the purchase of the eligible tangible personal property as if the small seller were a purchaser of that eligible tangible personal property.

Subsection 89(2) provides that tangible personal property referred to in paragraphs 141(1)(a)-(c) [exemptions in relation to industry and commerce], section 143 [exemption in relation to recording of motion picture or audio production] and in prescribed provisions of the regulations is not exempt from tax imposed under Part 3 [Taxes in Relation to Tangible Personal Property] when that tangible personal property is purchased by a small seller who must pay tax in accordance with subsection 89(1).

Under the PSTERR, the following provisions are prescribed for the purposes of subsection 89(2):

PSTERR subsections 38(2) and 38(5) [chemical substances, catalysts and direct agents], as provided by PSTERR subsection 38(6);
PSTERR subsections 39(3) and 39(4) [abrasives, dies, jigs, patterns and moulds], as provided by PSTERR subsection 39(5);
PSTERR subsections 40(1), 40(2) and 40(3) [photographers and printers], as provided by PSTERR subsection 40(4);
PSTERR subsection 59(3) and 59(4) [custom software, custom modified software and other software], as provided by PSTERR subsection 59(6);
PSTERR Division 2 [Exemptions for Machinery and Equipment] and PSTERR Division 3 [Related Exemptions] of Part 5 [Production Machinery and Equipment], other than PSTERR Section 113 [services related to qualifying machinery or equipment], as provided by PSTERR paragraph 117(1)(a) [provisions prescribed for purposes of sections 89 (2), 90 (4), 99 (6) and 112 (2) of Act].

Section 28 [when tax is payable in respect of a purchase or lease] provides for when tax is payable under section 89.

R.1 Small Sellers Reselling Eligible Tangible Personal Property To Retailers (Issued: 2014/11)

The reference to "resale" in subsection 89(1) should be read as a reference to "resale at a retail sale." When a small seller purchases eligible tangible personal property for resale to their customer, the small seller pays tax on the purchase of the eligible tangible personal property. However, when a small seller purchases eligible tangible personal property for resale to a retailer and the retailer sells the eligible tangible personal property to their customer, the customer must pay tax on the purchase of the eligible tangible personal property. In these instances, the small seller, who also paid tax when purchasing the eligible tangible personal property, did not purchase the eligible tangible personal property for resale at a retail sale and is eligible for a refund of the tax paid on the purchase of that eligible tangible personal property.

Section 90 – Tax On Eligible Tangible Personal Property Brought Into British Columbia

PST - SEC.90/Int.-R.1

References:

Act: Section 1 "eligible tangible personal property", "small seller"; Section 28; Section 49; Section 55; Section 89; Section 141; Section 143; Section 161

PSTERR: Section 38; Section 39; Section 40; Section 59; Part 5 – Division 2; Part 5 – Division 3; Section 113; Section 117

Bulletin PST 003

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 90 the taxing provision that requires a small seller to pay tax on eligible tangible personal property brought into British Columbia for resale.

Subsection 90(1) provides that, subject to subsection 90(2), section 90 applies to a small seller who

a) brings or sends into British Columbia, or receives delivery of in British Columbia, eligible tangible personal property for resale, and

b) does not pay tax imposed under section 55 [tax if property brought into British Columbia from outside Canada] in relation to the eligible tangible personal property.

Subsection 90(2) provides that section 90 does not apply to a person in relation to eligible tangible personal property if the person is required to pay tax or is exempt from tax under section 89 [tax on acquisition of eligible tangible personal property] in relation to the eligible tangible personal property.

Subsection 90(3) provides that a small seller to whom section 90 applies must pay tax imposed under section 49 [tax if tangible personal property brought into British Columbia for use] on the eligible tangible personal property as if the small seller were a person whom section 49 applies in relation to that eligible tangible personal property.

Subsection 90(4) provides that tangible personal property referred to in paragraphs 141(1)(a)-(c) [exemptions in relation to industry and commerce], section 143 [exemption in relation to recording of motion picture or audio production] and in prescribed provisions of the regulations is not exempt from tax imposed under Part 3 [Taxes in Relation to Tangible Personal Property] when that tangible personal property is brought or sent into British Columbia by, or delivered in British Columbia to, a small seller who must pay tax in accordance with subsection 90(3).

Under the PSTERR, the following provisions are prescribed for the purposes of subsection 90(4):

PSTERR subsections 38(2) and 38(5) [chemical substances, catalysts and direct agents], as provided by PSTERR subsection 38(6);
PSTERR subsections 39(3) and 39(4) [abrasives, dies, jigs, patterns and moulds], as provided by PSTERR subsection 39(5);
PSTERR subsections 40(1), 40(2) and 40(3) [photographers and printers], as provided by PSTERR subsection 40(4);
PSTERR subsection 59(3) and 59(4) [custom software, custom modified software and other software], as provided by PSTERR subsection 59(6);
PSTERR Division 2 [Exemptions for Machinery and Equipment] and PSTERR Division 3 [Related Exemptions] of Part 5 [Production Machinery and Equipment], other than PSTERR Section 113 [services related to qualifying machinery or equipment], as provided by PSTERR paragraph 117(1)(a) [provisions prescribed for purposes of sections 89 (2), 90 (4), 99 (6) and 112 (2) of Act].

Section 28 [when tax is payable in respect of a purchase or lease] provides for when tax is payable under section 90.

R.1 Small Sellers Reselling Eligible Tangible Personal Property To Retailers (Issued: 2014/11)

For an interpretation of "resale," see PSTA/SEC.89/R.1.

Section 91 – Exemption In Relation To Eligible Tangible Personal Property Purchased From Small Seller

PST - SEC.91/Int.

References:

Act: Section 1 "eligible tangible personal property", "small seller"; Section 37

Bulletin PST 003

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 91 that if a purchaser purchases eligible tangible personal property from a small seller, the purchaser is exempt from tax imposed under section 37 [tax on purchase] on that purchase.

Division 11 — Energy Products

Section 92 – Tax On Purchase Of Energy Product

PST - SEC.92/Int.

References:

Act: Section 1 "collector", "energy product"; Section 28; Section 93; Section 94; Section 147; Section 153; Section 203

PSTR: Section 86; Section 88

Bulletin PST 203

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 92 the taxing provision that imposes an additional 0.4% tax on the purchase price of an energy product in British Columbia. As part of the BC Energy Plan, the government created the 0.4% Innovative Clean Energy (ICE) Fund tax to raise revenue for the ICE Fund to help raise revenue to support clean energy initiatives.

Subsection 92(1) provides that a purchaser who purchases an energy product at a sale in British Columbia must pay to the government, for the raising of revenue for the purposes of the ICE Fund special account established by the Special Accounts Appropriation and Control Act, tax at the rate of 0.4% of the purchase price of the energy product.

Subsection 92(2) provides that if a collector sells an energy product at a sale in British Columbia to a person who alleges that the energy product is being purchased for resale, the person must nevertheless pay 0.4% ICE Fund tax payable under subsection 92(1) as if the person were a purchaser and the collector must nevertheless levy and collect the tax under subsection 92(1) unless the collector obtains, at or before the time the 0.4% ICE Fund tax is payable,

(a) that person’s registration number, or

(b) if that person does not have a registration number, a declaration in a form acceptable to the director from that person (Certificate of Exemption – General (form FIN 490)).

Note: under section 94 [tax under this Division is additional tax] the 0.4% ICE Fund tax on energy products is an additional tax. Note: the 0.4% ICE Fund tax applies on the pre-tax purchase price of the energy product and does not form part of the purchase price for the purposes of the 7% PST (i.e., the 0.4% ICE Fund tax does not apply on the 7% PST, and vice versa).

Section 28 [when tax is payable in respect of a purchase or lease] provides for when the 0.4% ICE Fund tax is payable under section 92.

Section 93 – Tax If Energy Product Brought Into British Columbia For Use

PST - SEC.93/Int.

References:

Act: Section 1 "BC resident", "collector", "energy product"; Section 28; Section 29; Section 92; Section 147; Section 153; Section 179; Section 203

PSTR: Section 86; Section 88

Bulletin PST 203

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 as amended by Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 provides under section 93 the taxing provision that imposes an additional 0.4% tax on the purchase price of energy products brought into British Columbia for use. The government created this tax, also known as the 0.4% Innovative Clean Energy (ICE) Fund tax, to raise revenue for the ICE Fund to help support clean energy initiatives as part of the BC Energy Plan.

Subsection 93(1) provides that, subject to subsection 93(2), section 93 applies to a person in relation to an energy product if

(a) the person is a BC resident who brings or sends into British Columbia, or receives delivery of in British Columbia, an energy product for use or consumption

(i) by the BC resident,

(ii) by another person at the BC resident’s expense,

(iii) by a principal for whom the BC resident acts as agent, or

(iv) by another person at the expense of a principal for whom the BC resident acts as agent,

(b) the person is a BC resident and a person who is not a BC resident brings or sends into British Columbia, or receives delivery of in British Columbia, an energy product for use or consumption

(i) by the BC resident, or

(ii) by the person who is not BC resident, or by another person, at the BC resident’s expense, or

(i) brings or sends into British Columbia, or receives delivery of in British Columbia, an energy product, and

(ii) uses the energy product in British Columbia in the course of the person’s business, whether or not the business is carried on in British Columbia.

Subsection 93(2) provides that section 93 does not apply to a person in relation to an energy product if the person is required to pay, or is exempt from, the 0.4% ICE Fund tax under section 92 [tax on purchase of energy product] in relation to the energy product. This ensures that the 0.4% ICE Fund tax on energy products does not apply twice.

Subsection 93(3) provides that a person to whom section 93 applies must pay tax to the government, for the raising of revenue for the purposes of the ICE Fund special account established by the Special Accounts Appropriation and Control Act, tax at the rate of 0.4% of the purchase price of the energy product.

Subsection 93(4) provides that if a collector causes an energy product to be delivered in British Columbia to a person who alleges that the energy product is being purchased for resale, the person must nevertheless pay the 0.4% ICE Fund tax under subsection 93(3) as if the person were a purchaser to whom section 93 applies and the collector must nevertheless levy and collect the 0.4% ICE Fund tax under subsection 93(3) unless the collector obtains, at or before the time the 0.4% ICE Fund tax is payable,

(a) that person’s registration number, or

(b) if that person does not have a registration number, a declaration in a form acceptable to the director from that person (Certificate of Exemption – General (form FIN 490)).

Section 28 [when tax is payable in respect of a purchase or lease] and section 29 [when tax is payable if tax not collected when consideration is paid or becomes due] provide for when the 0.4% ICE Fund tax is payable under section 93.

Section 94 – Tax Under This Division Is Additional Tax

PST - SEC.94/Int.

References:

Act: Section 1 "energy product"; Part 3 – Division 11

Bulletin PST 203

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 94 that the 0.4% ICE Fund tax on the purchase price of energy products imposed under Division 11 [Energy Products] of Part 3 [Taxes in Relation to Tangible Personal Property] is in addition to any other tax payable under Part 3 in respect of the energy products.

Section 95 – Exemptions In Relation To Energy Products

PST - SEC.95/Int.

References:

Act: Section 1 "collector", "energy product"; Section 153; Part 3 – Division 11; Section 96; Section 147; Section 153; Section 203

PSTR: Section 88

Bulletin PST 203

Interpretation (Issued: 2013/11; Revised: 2014/09)

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 amended section 95 to remove redundant exemptions for natural gas. (With the amendment, natural gas remains exempt from the ICE Fund tax, but the specific references to natural gas have been removed.)

Under section 95, fuel, as defined in the Motor Fuel Tax Act, other than propane included within the definition of "energy product", is exempt from the ICE Fund tax.

Section 95 also provides for an exemption from the ICE Fund tax once a person has paid at least $100,000 in ICE Fund tax in a specified one year period spanning April 1 through March 31.

The $100,000 maximum can be reached on more than one energy product. For example, if a person paid $60,000 in ICE Fund tax on natural gas and $40,000 on fuel oil in the specified one year period, the maximum has been reached.

Section 96 – Refund Of Excess If Maximum Tax Paid

PST - SEC.96/Int.

References:

Act: Section 1 "energy product"; Part 3 – Division 11; Section 95

Bulletin PST 203

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 96 that if the director is satisfied that during the one year period running from April 1 to March 31 established in subsection 95(2) [exemptions in relation to energy products] a person has paid more than $100,000 in 0.4% ICE Fund tax payable on the purchase of energy products under Division 11 [Energy Products] of Part 3 [Taxes in Relation To Tangible Personal Property], the director must refund to the person the amount of 0.4% ICE Fund tax paid in excess of $100,000.

Section 97 – Reporting Requirements In Relation To Energy Products

PST - SEC.97/Int.

References:

Act: Section 1 "collector", "energy product"; Part 3 – Division 11; Section 238

Bulletin PST 203

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 97 that a collector must report to the director the amounts of 0.4% ICE Fund tax on sales of energy products that were required to be collected under Division 11 [Energy Products] of Part 3 [Taxes in Relation To Tangible Personal Property], when requested by the director or required under the regulations (currently, nothing is required by the regulations).

Division 12 — Other Taxes in Relation to Tangible Personal Property

Section 98 – Liquor Sold Under Liquor Permit

PST - SEC.98/Int.-R.1

References:

Act: Section 1 "liquor"; Section 28; Section 37; Section 182; Section 182.1

Bulletin PST 300

Interpretation (Issued: 2013/11; Revised: 2017/09, 2024/05)

Effective April 25, 2024, Bill 3, Budget Measures Implementation Act, 2024 amended paragraph 98(3)(b) to replace “in the manner and in a form” with “in a form and in a manner,” for consistency with other sections of the Act.

Effective January 23, 2017, Bill 27, Liquor Control and Licensing Act, 2015, brought into force by B.C. Reg. 241/2016, amended section 98 to replace the term "special occasion licence" with the term "liquor permit".

The holder of a liquor permit, or their agent, must pay tax on liquor purchased for resale under the permit. Additionally, if liquor is to be sold at a mark-up, the holder of the liquor permit, or their agent, must pay tax on the estimated proceeds at the time the permit is obtained.

The holder must also collect tax on liquor sold under a liquor permit. The tax collected may be retained as reimbursement for the tax paid on the liquor purchased for resale and on the expected proceeds. However, if actual sales are more or less than estimated, there is either an additional remittance obligation or refund available

R.1 Refunds To Holders Of Liquor Permits (Issued: 2017/09)

Subsection 98(5) authorizes a refund in relation to liquor permits. The refund is payable to the "holder" of a liquor permit.

"Holder" is not a defined term. However, under the Liquor Control and Licensing Act, a "permittee" means "a person who holds a permit". For the purposes of administering subsection 98(5), the ministry regards the permittee to be the holder of a liquor permit. By extension, a holder must be a "person".

In some cases, the permittee named on the liquor permit has no legal personality. This may occur when applicants make an error in providing information during the permitting process. For example, while applicants are instructed against entering the name of an informal organization (e.g., Slowpoke Sunday Night Softball) in certain parts of the permit application, the name of such an organization will appear in the "permittee" field of the liquor permit if the instructions are not followed. Organizations without legal personality cannot be permittees. When such errors occur, the person named as the "applicant" on the liquor permit is considered to be the permittee and, by extension, the holder of the liquor permit.

A refund application under subsection 98(5) must be made by the holder of a liquor permit. When the name that appears in the "permittee" field of the liquor permit has legal personality, the application must be made in that name. When the name that appears in the "permittee" field does not have legal personality, the application must be made by the person named as the "applicant" on the permit.

Section 99 – Tax On Acquisition Of Exclusive Product By Independent Sales Contractor

PST - SEC.99/Int.

References:

Act: Section 1 "direct seller", "entry date", "exclusive product", "independent sales contractor"; Section 28; Section 37; Section 48; Section 141; Section 179; Section 180

PSTERR: Section 38; Section 39; Section 40; Section 59; Part 5 – Division 2; Part 5 – Division 3; Section 113; Section 117; Part 8

PSTR: Section 72

Bulletin PST 004

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 repealed and replaced section 99.

Section 99 provides the following taxing provisions that apply to an independent sales contractor in relation to an exclusive product.

Subsection 99(1) provides that an independent sales contractor who purchases an exclusive product at a sale in British Columbia from a direct seller must pay to the government tax at the rate of 7% of the direct seller’s suggested retail price for the exclusive product.

"Suggested retail price" means the price published (e.g., in a catalogue, a price list or similar document) by the direct seller that applies to an exclusive product sold to final purchasers/consumers. In certain cases, the suggested retail price may be a discounted price (e.g., special catalogue inserts). The suggested retail price does not include any taxes.

Subsection 99(2) provides that an independent sales contractor of a direct seller who purchases an exclusive product at a sale in British Columbia from another independent sales contractor of the direct seller must pay to the government tax at the rate of 7% of the direct seller’s suggested retail price for the exclusive product.

Subsection 99(3) provides that an independent sales contractor who brings or sends into British Columbia, or receives delivery of in British Columbia, an exclusive product acquired from a direct seller must pay to the government tax at the rate of 7% of the direct seller’s suggested retail price for the exclusive product.

Subsection 99(4) provides that an independent sales contractor of a direct seller who brings or sends into British Columbia, or receives delivery of in British Columbia, an exclusive product acquired from another independent sales contractor of the direct seller must pay to the government, by paying to the direct seller as agent of the government, tax at the rate of 7% of the direct seller’s suggested retail price for the exclusive product.

Subsection 99(5) provides that subsection 99(3) or subsection 99(4) does not apply to an independent sales contractor in relation to an exclusive product if

(a) the independent sales contractor must pay tax imposed under subsection 99(1) or 99(2) in relation to that exclusive product, or

(b) the independent sales contractor must pay tax imposed under Division 5 [Property Brought into British Columbia from Outside Canada] in relation to that exclusive product.

Subsection 99(6) provides that tangible personal property referred to in paragraphs 141(1)(a)-(c) and in prescribed provisions of the regulations is not exempt from tax imposed under section 99 when acquired by an independent sales contractor who must pay tax in accordance with section 99.

Under the PSTERR, the following provisions are prescribed for the purposes of subsection 99(6):

PSTERR subsections 38(2) and 38(5) [chemical substances, catalysts and direct agents], as provided by PSTERR subsection 38(6);
PSTERR subsections 39(3) and 39(4) [abrasives, dies, jigs, patterns and moulds], as provided by PSTERR subsection 39(5);
PSTERR subsections 40(1), 40(2) and 40(3) [photographers and printers], as provided by PSTERR subsection 40(4);
PSTERR subsection 59(3) and 59(4) [custom software, custom modified software and other software], as provided by PSTERR subsection 59(6);
PSTERR Division 2 [Exemptions for Machinery and Equipment] and PSTERR Division 3 [Related Exemptions] of Part 5 [Production Machinery and Equipment], other than PSTERR Section 113 [services related to qualifying machinery or equipment], as provided by PSTERR paragraph 117(1)(c) [provisions prescribed for purposes of sections 89 (2), 90 (4), 99 (6) and 112 (2) of Act];

Subsection 99(7) provides that tax payable under subsection 99(4) must be paid on or before the last day of the month after the month that includes the entry date of the exclusive product.

Section 28 [when tax is payable in respect of a purchase or lease] provides for when tax is payable under subsections 99(1), 99(2) or 99(3).

Note: PSTERR Part 8 [Refunds and Credits for Exclusive Products] provides refunds and credits in relation to exclusive products.

Section 100 – Tax on Gift of Vehicle, Boat or Aircraft Given in British Columbia

PST - SEC.100/Int.-R.2

References:

Act: Section 1 "boat", "entry date", "Excise Tax Act", "fair market value", "passenger vehicle", "vehicle", "vehicle registration legislation"; Section 30; Section 31; Section 49; Part 3 – Division 6; Part 3 – Division 7; Section 153; Section 179

PSTERR: Section 18; Section 19; Section 20; Section 149; Section 151

PSTR: Section 32

Bulletin PST 108; Bulletin PST 134; Bulletin PST 308; Bulletin PST 312

Interpretation (Issued: 2013/11; Revised 2021/11)

Effective April 1, 2018, Bill 2, Budget Measures Implementation Act, 2018 amended section 100 to provide for additional PST rates on gifts of passenger vehicles received in British Columbia with a fair market value of $125,000 or more. For passenger vehicles with a fair market value of $125,000 - $149,999.99 the rate increased to 15%, and to 20% for those with a fair market value of $150,000 and over.

For gifts that the new PST rates apply to, the PST amount may be included in the consideration for purposes of calculating the GST. For additional information relating to GST, contact the Canada Revenue Agency.

Effective May 1, 2013, Bill 2, Provincial Sales Tax Transitional Provisions and Amendments Act, 2013 amended section 100 by adding subsections 100(1.1), (1.2) and (1.3). The purpose of this amendment was to:

apply the tax on gifts of vehicles received on or after July 1, 2010 and before April 1, 2013 where a vehicle, boat or aircraft is registered on or after May 1, 2013, and
apply the tax on gifts of vehicles, boats or aircraft brought or sent into British Columbia on or after July 1, 2010 and before April 1, 2013 if tax was not paid and is not payable under the Consumption Tax Rebate and Transition Act by that person in relation to the vehicle.

For a vehicle, boat or aircraft gifted by a donor who purchased the item at a private sale – 12%;
For a vehicle, boat or aircraft gifted by a donor who is a GST registrant, or the vehicle, boat or aircraft was imported from outside Canada – 7-10%;

Tax is payable on the fair market value of the gift on the day it was received.

R.1 Proportional Interests In Vehicles Gifted (Issued: 2014/07)

Generally, when less than a full interest in a vehicle is gifted the Ministry will apply tax to the interest being transferred.

Example #1

Donor = A, B, C
Recipient = D, E

A and D are related individuals. D is not a related individual to B, C, or E. E is not a related individual to A, B, C, or D. Assume: 1) A, B, and C all have an equal share in the vehicle. 2) D and E will each have a ½ interest in the vehicle. 3) A, B, and C have paid PST on the vehicle.

A is giving away a 1/3 interest in the vehicle to D and E. Therefore, because both D and E will have a ½ interest in the vehicle, D is receiving ½ of 1/3 from A and E is receiving ½ of 1/3 from A. So, D is exempt on 1/6 of the fair market value of the vehicle.

Full calculation for the exempt portion:

1/3 [A's interest] * ½ [D's final interest] = 1/6 = 16.67% of the fair market value.

Therefore, D must pay tax on 33.33% of the fair market value of the gift vehicle (i.e., 50% - 16.67%). E must pay tax on 50% of the fair market value.

Example #2

Donor = A, B, C
Recipient = D, E

A and D are related individuals. B and D are related individuals. E is not a related individual to A, B, C, or D. Assume: 1) A, B, and C all have an equal share in the vehicle. 2) D and E will each have a ½ interest in the vehicle. 3) A, B, and C have paid PST on the vehicle.

A is giving away a 1/3 interest in the vehicle to both D and E. Therefore, because both D and E will have a ½ interest in the vehicle, D is receiving ½ of 1/3 from A and E is receiving ½ of 1/3 from A. Similarly, B is giving away a 1/3 interest in the vehicle to both D and E. Therefore, because both D and E will have a ½ interest in the vehicle, D is receiving ½ of 1/3 from B and E is receiving ½ of 1/3 from B. So, D is exempt on 1/3 of the fair market value of the vehicle.

Full calculation for the exempt portion:

1/3 [A's interest] * ½ [D's final interest] = 1/6
+
1/3 [B's interest] * ½ [D's final interest] = 1/6
= 2/6 = 1/3 = 33.33% of the fair market value.

Therefore, D must pay tax on 16.67% of the fair market value of the gift vehicle (i.e., 50% - 33.33%). E must pay tax on 50% of the fair market value.

Example #3

Donor = A, B
Recipient = C, D, E, F

A, B, C are related individuals. D is related to B but not A. E is not a related individual to A, B, C, D or F. F is not a related individual to A, B, C, D, or E. Assume: 1) A and B have an equal share in the vehicle. 2) C, D, E and F will each have a 1/4 interest in the vehicle. 3) A and B have paid PST on the vehicle.

A is giving a ½ interest to C, D, E, and F. Therefore, because C, D, E, and F will have a ¼ interest in the vehicle, C is receiving ¼ of ½ from A, D is receiving ¼ of ½ from A, E is receiving ¼ of ½ from A, and F is receiving ¼ of ½ from A. Similarly, B is giving away a ½ interest in the vehicle to C, D, E and F. Therefore, because C, D, E and F will have a ¼ interest in the vehicle, C is receiving ¼ of ½ from B, D is receiving ¼ of ½ from B, E is receiving ¼ of ½ from B, and F is receiving ¼ of ½ from B. So, C is exempt on 1/4 of the fair market value of the vehicle and D is exempt on 1/8 of the fair market value of the vehicle.

Full calculation for the exempt portion:

C's tax liability

½ [A's interest] * ¼ [C's interest] = 1/8
+
½ [B's interest] * ¼ [C's interest] = 1/8
= 2/8 = ¼ = 25% of the fair market value

In other words, C is exempt on 25% of the fair market value of the vehicle (i.e., they have no tax liability because they are only purchasing a 25% interest).

D's tax liability

½ [B's interest] * ¼ [D's interest] = 1/8 = 12.5% of the fair market value

In other words, D is exempt on 12.5% of the fair market value of the vehicle and must pay tax on 12.5% of the fair market value of the vehicle (i.e., 1/4 - 1/8).

E and F must both pay tax on 25% of the fair market value.

R.2 Escheat (Issued: 2014/09)

When a corporation is dissolved it ceases to exist. If the corporation owned TPP at the time of dissolution, the property escheats to the crown (i.e., the ownership of the assets vests in the crown) under section 344 of the Business Corporations Act. A person (generally the persons who were shareholders of the corporation) may apply to the crown to have the assets transferred from the crown to them under the Escheat Act. Such a process is completed by ministerial order.

In some situations the assets are transferred from the crown to the recipient with no consideration. In these cases, if the asset transferred from the crown to the recipient (e.g. shareholder) is a vehicle, boat or aircraft, the recipient must pay PST on the vehicle, boat or aircraft. The transfer from the crown to the person is considered a "gift" for the purposes of section 100 because it is the voluntary transfer of a beneficial interest without consideration. As with all transfers under section 100, the recipient must pay tax on the fair market value of the vehicle, boat or aircraft.

If the TPP being transferred to the recipient from the crown is TPP other than a vehicle, boat or aircraft and there is no consideration, then the transfer is not subject to PST. The transfer is not a "sale" for the purposes of section 37.

In other situations, the TPP is transferred for "$1 and other good consideration." In such cases, regardless of whether the TPP is a vehicle boat or aircraft, the transfer is a "sale" for the purposes of section 37 and the recipient must pay PST.

Section 101 – Tax On Reusable Containers

PST - SEC.101/Int.-R.1

References:

Act: Section 1 "purchase price", "reusable container"; Section 28; Section 29; Section 37; Section 48; Section 141; Section 179

PSTERR: Section 43; Section 149; Section 151; Section 152

Bulletin PST 305

Interpretation (Issued: 2013/11)

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 101 the following taxing provisions that apply to reusable containers.

Subsection 101(1) provides that, subject to subsection 101(3), a person who purchases a reusable container at a sale in British Columbia must pay to the government tax at the rate of 7% of the purchase price of the reusable container.

Subsection 101(2) provides that, subject to subsection 101(3) and subsection 101(4), a person who brings or sends into British Columbia, or receives delivery of in British Columbia, a reusable container must pay to the government tax at the rate of 7% of the purchase price of the reusable container.

Subsection 101(3) provides that subsection 101(1) or subsection 101(2) applies to a person in relation to the reusable container if the person intends to sell a product that is packaged or delivered in or on the reusable container and

(a) the reusable container is subject to a deposit, credit, penalty or replacement charge to encourage its return for reuse as a container,

(b) the person retains an interest in the reusable container after the sale of the product,

(c) the reusable container, or a similar reusable container, is required to be returned to the person after the sale of the product, or

(d) the product is sold in a jurisdiction where the reusable container is subject to a regulatory or contractual scheme to recover the reusable container for reuse by the person or by other participants in the scheme.

Subsection 101(4) provides that subsection 101(2) does not apply to a person who is required to pay tax or is exempt from tax under subsection 101(1) in relation to that reusable container.

Note: Under PSTERR section 43 [bottles for milk products], bottles are exempt from tax under Part 3 of the Act [Taxes in Relation to Tangible Personal Property], other than Division 9 [Change in Use], if the bottles are:

(a) obtained for use to hold a milk product that is sold at a retail sale, and

(b) returnable and reusable.

R.1 Parts For Returnable Containers (Drums) Used By Oil Companies (Issued: 2014/04)

An oil supplier is required to pay PST on the purchase price of a reusable oil drum that the supplier uses to provide oil to its customers if:

the drum must to be returned to the oil supplier, or
the customer is subject to a penalty for failing to return the drum.

Flanges, bungs and gaskets are part of the reusable oil drum and are subject to PST when purchased separately by the oil supplier. However, a cap seal that must be removed before the drum is emptied and that is placed over the bung is not part of the reusable container. The oil supplier may purchase such seals exempt from PST under paragraph 141(1)(a) [exemptions in relation to industry and commerce] as TPP purchased for the purpose of packaging the oil for retail sale.

Section 102 – Tax On Leased Property Occasionally Supplied With Operator

PST - SEC.102/Int.

References:

Act: Section 1 "lease", "lease price"; Section 35; Section 82; Section 83; Section 142; Section 192

PSTERR: Section 149; Section 150; Section 151

PSTR: Section 23; Section 79

Bulletin PST 315

Interpretation (Issued: 2013/11)

Under subsections 142(4) and (5) [exemptions for tangible personal property intended for lease], a person is exempt from tax imposed under Part 3 [Taxes in Relation to Tangible Personal Property] on tangible personal property if the person capitalizes the tangible personal property as lease inventory in their business accounting records and the property is solely for the purposes of

(a) leasing the property to persons, and

(b) occasionally, under an agreement, supplying the property with a person to operate it.

Where a person enters into an agreement to supply tangible personal property with a person to operate it, the person receiving the supplied tangible personal property with operator is not subject to tax because under paragraph (a) of the definition of "lease", this is not a lease. To ensure tax is still payable on the tangible personal property used under such agreements, where all the criteria under section 102 apply, the person providing the tangible personal property with an operator must themselves pay the tax on the price at which the property would have been leased had it been leased without an operator.

Subsection 102(1) provides that a person, other than a person who has paid tax under section 82 [tax if property used for new purpose] or section 83 [tax if change in use of property acquired for lease], who purchases tangible personal property exempt from tax under subsection 142(4) [exemptions for purchases or leases of tangible personal property intended for lease], or who brings or sends into British Columbia, or receives delivery of in British Columbia, tangible personal property exempt from tax under subsection 142(5), must, when the property is, under an agreement, supplied with a person to operate it, pay to the government tax at the applicable rate under section 35 [rates of tax in relation to lease price] as if the price at which that property would have been leased had it been leased without supplying a person to operate it were the lease price of the tangible personal property.

Subsection 102(2) provides that if

(a) a person, other than a person who has paid tax under section 82 or section 83, purchases in British Columbia, brings or sends into British Columbia or receives delivery of in British Columbia tangible personal property exempt from tax under subsection 142(1), (2) or (2.1),

(b) the only subsequent use of that tangible personal property, other than leasing it, is occasionally, under an agreement, supplying the property with a person to operate it, and

the person must, when the property is, under an agreement, supplied with a person to operate it, pay to the government tax at the applicable rate under section 35 as if the price at which that property would have been leased had it been leased without supplying a person to operate were the lease price of the tangible personal property.

Subsection 102(3) provides that tax payable under subsection 102(1) or subsection 102(2) must be paid

on or before the prescribed date (as provided under PSTR section 23 [prescribed date for section 102 of Act]; see PSTR/Sec. 23/Int.), and
in the prescribed manner (as provided under PSTR subsections 79(3) and 79(4) [manner for payment of tax]; see PSTR/Sec.79/Int.).

Section 103 – Tax On Subsequent Purchase Or Lease After Refund

PST - SEC.103/Int.

References:

Act: Section 1 "collector", "related individual"; Section 34; Section 37; Part 3 – Division 2; Part 3 – Division 3; Part 6

PSTERR: Part 2; Part 5; Part 9

PSTR: Section 24

Interpretation (Issued: 2013/11; Revised: 2014/09)

Effective April 1, 2013, Bill 8, Budget Measures Implementation Act, 2014 amended section 103 to add references to credits, recognizing that collectors may refund or credit PST to a purchaser.

Effective April 1, 2013, Bill 54, Provincial Sales Tax Act, 2012 provides under section 103 the taxing provision that applies when TPP that was returned to a collector is subsequently purchased or leased by the purchaser, a related individual of the purchaser, or an associated corporation of the purchaser.

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More topics

Provincial Sales Tax Act, Part 3 - Taxes in Relation to Tangible Personal Property

Division 1 — Rates of Tax

Section 34 – Rates of Tax in Relation to Purchase Price

PST - SEC.34/Int.

Section 35 – Rates of Tax in Relation to Lease Price

PST - SEC.35/Int.-R.1

R.1 Tax Rate Value and Warranties, Service Contracts, and Maintenance Agreements (Issued: 2014/07)

Section 36 – Rates Of Tax In Relation To Gifts

PST - SEC.36/Int.

Division 2 — Purchases of Tangible Personal Property

Section 37 – Tax on Purchase

PST - SEC.37/Int.-R.2

R.1 Production of Advertising Flyers (Issued: 2014/08)

R.2 Items Removed from Hotels (Issued: 2014/08)

Division 3 — Leases of Tangible Personal Property

Section 38 – Application Of This Division

PST - SEC.38/Int.

Section 39 – Tax On Leases

PST - SEC.39/Int.

Section 40 – Tax on Motor Vehicle Leased Outside British Columbia and Registered for Use in British Columbia

PST - SEC.40/Int.

Section 41 – Tax If Leased Property Used In And Outside British Columbia During Rental Period

PST - SEC.41/Int.

Section 42 – Tax If Balance Of Lease Price Becomes Due On Breach Of Lease

PST - SEC.42/Int.

Section 43 – Additional Tax On Lease Of Passenger Vehicle

PST - SEC.43/Int.

Section 44 – Exemption If Lease Under Sale And Lease-Back Arrangement

PST - SEC.44/Int.

Section 45 – Refund For Leased Property Used Outside British Columbia

PST - SEC.45/Int.

Section 46 – Refund On Motor Vehicle Leased Outside British Columbia

PST - SEC.46/Int.

Division 4 — Tangible Personal Property Brought into British Columbia

Section 47 – Definition

PST - SEC.47/Int.

Section 48 – Application Of This Division

PST - SEC.48/Int.

Section 49 – Tax if Tangible Personal Property Brought into British Columbia for Use

PST - SEC.49/Int.-R.1

R.1 Exchange Rate (Issued: 2016/06; Revised 2024/08)

Section 50 – Tax On Registration Of Vehicle Brought Into British Columbia

PST - SEC.50/Int.

Section 51 – Tax If Tangible Personal Property Brought Into British Columbia For Temporary Use

PST - SEC.51/Int.-R.1

R.1 Exchange Rate (Issued: 2016/06)

Section 51.1 – Tax If Tangible Personal Property No Longer For Temporary Use

PST - SEC.51.1/Int.

Section 52 – Tax If Tangible Personal Propery Brought Into British Columbia By Non-Residents

PST - SEC.52/Int.

Section 53 – Exemption If Less Than Minimum Threshold Use In British Columbia

PST - SEC.53/Int.

Division 5 — Property Brought into British Columbia from Outside Canada

Section 54 – Application Of This Division

PST - SEC.54/Int.

Section 55 – Tax if Property Brought into British Columbia from Outside Canada

PST - SEC.55/Int.

Section 56 – Detention Of Tangible Personal Property

PST - SEC.56/Int.

Section 57 – Tax Payable To Collection Agent Even Though Exemption Claimed

PST - SEC.57/Int.

Section 58 – Refund If Property Brought Into British Columbia For Temporary Use

PST - SEC.58/Int.

Division 6 — Conveyances Used Interjurisdictionally

Section 59 – Definitions

PST - SEC.59/Int.

Section 60 – Tax If Conveyance Purchased In British Columbia For Interjurisdictional Use

PST - SEC.60/Int.

Section 61 – Tax If Sale And Lease-Back Of Conveyance

PST - SEC.61/Int.

Section 61.1 – Tax If Sale And Lease-Back Of Conveyance For Which Tax Paid Under Former Act

PST - SEC.61.1/Int.

Section 62 – Tax If Leased Conveyance Used In British Columbia

PST - SEC.62/Int.

Section 63 – Tax If Conveyance Brought Into And Used In British Columbia

PST - SEC.63/Int.

Section 64 – Tax If Change In Use Of Conveyance Acquired For Resale

PST - SEC.64/Int.

Section 65 – Estimate Of Hours Or Distance Conveyance Will Travel