Provincial Sales Tax Exemption & Refund Regulation, Part 7 - Refunds and Credits for Multijurisdictional Vehicles

Section 135 – Credit If Vehicle Ceases To Be Multijurisdictional

PSTERR - SEC.135/Int.

References:

Act: Section 68 "prorating agreement", "travel ratio", "vehicle", "vehicle licence period"; Section 69; Section 71; Section 72; Section 72.1

Bulletin PST 135

Interpretation (Issued: 2014/02)

Effective April 1, 2013, B.C. Reg. 97/2013 provides under PSTERR section 135 the formula to calculate the amount of the credit the Insurance Corporation of British Columbia (ICBC) must provide in respect of a vehicle that ceases to be a multijurisdictional vehicle if subsections 72(5) or 72.1(5) of the Act applies.

Subsection 135(1) provides that in PSTERR section 135:

"applicable period", in respect of a vehicle referred to in subsection 72(5) [tax if vehicle ceases to be multijurisdictional] or subsection 72.1(5) [tax if transferred vehicle ceases to be multijurisdictional] of the Act, means the last vehicle licence period during which the vehicle was licensed under a prorating agreement;

"prorate period amount" means the amount calculated under PSTERR subsection 135(4) for a vehicle;

"purchase price" has the same meaning as for the purposes of section 72 or section 72.1 of the Act, as applicable;

"remaining balance amount" means the amount calculated under PSTERR subsection 135(3) for a vehicle.

Subsection 135(2) provides that the amount of the credit under subsection 72(5) or 72.1(5) of the Act for a vehicle,

(a) if the vehicle ceases to be licensed under a licence to which a prorating agreement applies before the end of the vehicle licence period, is the sum of the remaining balance amount and the prorate period amount for the vehicle, and

(b) in any other case, is the prorate period amount for the vehicle.

Subsection 135(3) provides that for the purposes of PSTERR subsection 135(2), the remaining balance amount for a vehicle must be calculated as follows:

remaining balance amount = tax paid x (months remaining /total months)

where

tax paid = the tax paid under one or both of section 69 [tax if multijurisdictional vehicle licensed] and section 71 [adjustment of tax under section 69] of the Act in respect of the vehicle for the applicable period;

months remaining = the number of whole months left in the applicable period at the time that the vehicle ceases to be licensed under the licence to which the prorating agreement applies;

total months = the number of whole and partial months in the applicable period.

Subsection 135(4) provides that for the purposes of PSTERR subsection 135(2), the prorate period amount for a vehicle must be calculated as follows:

prorate period amount = purchase price x total months x average travel ratio x 7%

where

purchase price = the purchase price of the vehicle;

total months = the number of whole months, up to a maximum of 60, in which the vehicle was licensed under the licence to which the prorating agreement applies, divided by 60;

average travel ratio = the average travel ratio during the total period the vehicle was licensed under the licence to which the prorating agreement applies.

Section 136 – Refund Or Credit Of Tax If Fleet Licensing Changed

PSTERR - SEC.136/Int.

References:

Act: Section 68 "vehicle", "vehicle licence period"; Section 69; Section 71; Section 74

Bulletin PST 135

Interpretation (Issued: 2014/02)

Effective April 1, 2013, B.C. Reg. 97/2013 provides under PSTERR section 136 the formula to calculate the amount of the refund the director may pay, or the credit that the Insurance Corporation of British Columbia (ICBC) must provide, where a multijurisdictional vehicle’s fleet license is changed to a different fleet.

Subsection 136(1) provides that in PSTERR section 136:

"applicable period", in respect of a vehicle referred to in subsection 74(1) [refund or credit of tax if fleet licensing changed] of the Act, means the last vehicle licence period under the previous licence referred to in paragraph 74(1)(b) or 74(1.2)(b) of the Act;

"different fleet", in respect of a vehicle referred to in subsection 74(1) of the Act, means the different fleet referred to in subsection 74(1) or paragraph 74(1.1)(c) of the Act.

Subsection 136(2) provides that the amount of the credit under subsection 74(2) of the Act or the amount of the refund under subsection 74(3) of the Act for a vehicle must be calculated in accordance with the following formula:

amount of credit or refund = tax paid x (months remaining /total months)

where

tax paid = the tax paid under one or both of section 69 [tax if multijurisdictional vehicle licensed] and section 71 [adjustment of tax under section 69] of the Act in respect of the vehicle for the applicable period;

months remaining = the number of whole months remaining in the applicable period at the time the vehicle is licensed as part of the different fleet;

total months = the number of whole and partial months in the applicable period.

 

Section 137 – Refund If Not Entitled To Credit Under Section 72 Or 72.1 Of Act

PSTERR - SEC.137/Int.

References:

Act: Section 68 "prorating agreement", "vehicle", "vehicle licence period"; Section 69; Section 71; Section 74.1

Bulletin PST 135

Interpretation (Issued: 2014/02)

Effective April 1, 2013, B.C. Reg. 97/2013 provides under PSTERR section 137 the formula to calculate the amount of the refund the director must pay in respect of a vehicle that ceases to be a multijurisdictional vehicle if section 74.1 of the Act applies.

Subsection 137(1) provides that in PSTERR section 137, "applicable period" means the last vehicle licence period during which a vehicle referred to in subsection 74.1(1) [refund if not entitled to credit under section 72 or 72.1 of Act] of the Act was licensed under a prorating agreement.

Subsection 137(2) provides that the amount of the refund under subsection 74.1(1) of the Act for a vehicle must be calculated as follows:

amount of refund = tax paid x (months remaining /total months)

where

tax paid = the tax paid under one or both of section 69 [tax if multijurisdictional vehicle licensed] and section 71 [adjustment of tax under section 69] of the Act in respect of the vehicle for the applicable period;

months remaining = the number of whole months left in the applicable period at the time that the vehicle ceases to be licensed under the licence to which the prorating agreement applies;

total months = the number of whole and partial months in the applicable period.

Section 137.1 - Refund At End Of Vehicle Licence Period

PSTERR - SEC.137.1/Int.

References:

Act: Section 1 "vehicle licence period"; Section 68 "prorating agreement", "vehicle "; Section 69; Section 71; Section 74.2

Bulletin PST 135

Interpretation (Issued: 2014/09)

Effective April 1, 2013, B.C. Reg. 117/2014 provides under PSTERR section 137.1 the formula to calculate the amount of the refund the director must pay in respect of a vehicle that ceases to be licensed under a prorating agreement if section 74.2 of the Act applies.

Section 138 – Credit If Tax Previously Paid

PSTERR - SEC.138/Int.

References:

Act: Section 68 "acquisition year", "bus", "travel ratio", "vehicle", "vehicle taxable value"; Section 75; Section 75.1

Bulletin PST 135

Interpretation (Issued: 2014/02)

Effective April 1, 2013, B.C. Reg. 97/2013 provides under PSTERR section 138 the formula to calculate the amount of credit that the Insurance Corporation of British Columbia (ICBC) must provide for a vehicle if tax was previously paid on the vehicle, as provided under section 75 or 75.1 of the Act.

Subsection 138(1) provides that the amount of the credit under subsection 75(1) or 75(1.1) [credit if tax previously paid] or subsection 75.1(1) or 75.1(2) [transition – credit if tax previously paid] of the Act for a vehicle must be calculated in accordance with the following formula:

amount of credit = taxable value x credit factor x travel ratio x travel months

where

taxable value = the vehicle taxable value;

credit factor = the tax credit factor, for the calendar year in respect of which the credit is claimed,

(a) established under PSTERR subsection 138(2), if the vehicle is not a bus, or

(b) established under PSTERR subsection 138(3), if the vehicle is a bus;

travel ratio = the travel ratio for the vehicle;

travel months = the number of whole and partial months in the vehicle licence period at the time that the vehicle is licensed, divided by 12.

Subsection 138(2) provides that the tax credit factor referred to in PSTERR subsection 138(1) for a calendar year in respect of which a credit is claimed for a vehicle other than a bus is the tax credit factor shown opposite the applicable calendar year as follows:

Subsection 138(2) Tax Credit Factor / Calendar Year
Calendar Year Tax Credit Factor
Acquisition year 2.944%
1st calendar year after the acquisition year 2.296%
2nd calendar year after the acquisition year 1.827%
3rd calendar year after the acquisition year 1.488%
4th calendar year after the acquisition year 1.247%
 

 

Subsection 138(3) provides that the tax credit factor referred to in PSTERR subsection 138(1) for a calendar year in respect of which a credit is claimed for a bus is the tax credit factor shown opposite the applicable calendar year as follows:

Subsection 138(3) Tax Credit Factor / Calendar Year
Calendar Year Tax Credit Factor
Acquisition year 2.498%
1st calendar year after the acquisition year 1.836%
2nd calendar year after the acquisition year 1.349%
3rd calendar year after the acquisition year 0.990%
4th calendar year after the acquisition year 0.730%
 

Section 138.1 - Refunds From Insurance Corporation Of British Columba

PSTERR - SEC.138.1/Int.

References:

Act: Section 1 "multijurisdictional vehicle", "vehicle licence period"; Section 68 "prorating agreement", "vehicle"; Section 69; Section 75.2

Bulletin PST 135

Interpretation (Issued: 2014/09)

Effective June 23, 2014, B.C. Reg. 117/2014 provides under PSTERR section 138.1 the circumstances under which ICBC may provide refunds in respect of a multijurisdictional vehicle ("MJV") under the authority provided under section 75.2 of the Act.

Three circumstances are described:

  1. Remedying overpayments of MJV tax that have resulted out of clerical errors made by ICBC.
  2. Refunds of MJV tax processed by ICBC that result out of International Registration Plan ("IRP") audits conducted by Ministry auditors.
  3. The cancellation of a MJV licence before that licence takes effect.

These refunds are for MJV tax only. ICBC is not authorized to issue PST refunds

Section 139 – Refund Or Credit For Trade-In Vehicles

PSTERR - SEC.139/Int.

References:

Act: Section 68 "vehicle", "vehicle licence period"; Part 3 – Division 7; Section 76

Bulletin PST 135

Interpretation (Issued: 2014/02)

Effective April 1, 2013, B.C. Reg. 97/2013 provides under PSTERR section 139 that the amount of the credit under subsection 76(2) [refund or credit for trade-in vehicles] of the Act or the amount of the refund under subsection 76(3) of the Act for a trade-in vehicle must be calculated in accordance with the following formula:

amount of credit or refund = (tax paid /12) x (months remaining)

where

tax paid = the tax paid under Division 7 [Multijurisdictional Vehicles] of Part 3 [Taxes in Relation to Tangible Personal Property] of the Act on the trade-in vehicle at the beginning of the vehicle licence period in which the vehicle is traded in against the purchase of the new vehicle;

months remaining = the number of whole months remaining in the trade-in vehicle's vehicle licence period at the time the vehicle is traded in against the purchase of the new vehicle.