What Other Kinds of Taxes Do I Have to Pay?
|This page is used in the Paying Taxes Lesson Module, a law-related ESL lesson for newcomers to Canada.|
What is sales tax?
You pay sales tax on most things you buy or use. They include clothing, furniture, restaurant meals, phones, taxis, etc. There are a few exceptions. For example, there is no sales tax on groceries, rent, and public transit.
Sales tax consists of a federal sales tax (5%) and a provincial sales tax (7% on goods and services). (In 2013, British Columbia abandoned the harmonized sales tax, or HST, that combined the federal and provincial sales taxes into a single sales tax of 12%.)
What is property tax?
If you own a house, a condominium, a building or land, you pay property tax every year to the town or city government.
How much you pay in property tax depends on the value of the house and the land. Your city or town government will send you a letter that tells you how much you have to pay and when you have to pay it. You pay less property tax if:
- you live in the home yourself,
- you are a senior, or
- you live in northern and rural parts of BC.
You also pay a tax when you buy property. If this is the first home you own anywhere in the world, you may not have to pay this tax. Talk to the notary or lawyer who is helping you with your property purchase.
What is duty?
Duty is a tax you pay on things you buy in another country and bring into Canada. For example, if you bring in clothing you bought outside Canada or the United States or Mexico, you pay duty on it when you cross the border.
Newcomers who are moving to Canada can bring their own things with them. You do not have to pay duty on them but you have to pay duty on any item you bring in that has not been used.
When you travel, you can bring some things into Canada and not pay duty on them. The length of your absence from Canada determines the amount of goods you can bring back, without paying any duties:
- 24 hours or more: You can bring back goods worth CAN$200 without paying duty.
- 48 hours or more: You can bring back goods worth CAN$800 without paying duty.
- 7 days or more: You can bring back goods worth CAN$800 without paying duty, and the goods can follow your entry into Canada (such as by courier or mail).
There are special rules about alcohol and tobacco.
What are consumer taxes?
Consumer taxes are included in the price of things you buy. British Columbia has consumer taxes on things including tobacco, motor fuels, and short-term accommodations.
Carbon tax is a consumer tax on the use of fossil fuels such as coal, oil and natural gas that put carbon dioxide into the atmosphere. Carbon tax rates are based on $30 per tonne of carbon dioxide put into the atmosphere. You pay a carbon tax when you buy gas for your vehicle.
What are business taxes?
There are special taxes for businesses. If you start a business in BC, you will need to pay business tax. Before you start the business, get some information and advice. It would be a good idea to talk to a lawyer. You may wish to start with Lawyer Referral. Lawyer Referral is a program where you can get advice and information for a fee of $25 plus taxes for the first 30 minutes.
| Lawyer Referral Program
Sometimes the government finds out a business is not paying taxes. The business may be forced to pay unpaid taxes, along with interest and penalty charges. If you do not pay tax, you can face criminal charges.
Do I have to keep records?
Keep your tax information for six years, including all the documents and all the receipts you used. The government has the right to ask you to provide this information to them. They may do an "audit." An audit is where they ask you to provide proof of your income and your deductions.
|This information applies to British Columbia, Canada. Last reviewed for legal accuracy by People's Law School, 2014.|
|Paying Taxes in BC © People's Law School is, except for the images, licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International Licence.|
Something which can be owned. See "chattels" and "real property."
Real property; a parcel of real property and the buildings upon it. See also "chattel," "ownership," and "possession."
A person licensed to practice law in a particular jurisdiction. See "barrister and solicitor."
In law, a legal obligation to do or not do something, whether under the common law or pursuant to legislation.
Evidence which establishes or tends to establish the truth of a fact; also, the conclusion of a logical argument. See "evidence" and "premises."