The price of paradise is rising precipitously for quarter-share owners in vacation properties, who are finding their taxes doubling and tripling after they buy.
Taxes on one vacation unit in a Vancouver Island resort jumped
from $3,800 to $15,200 when BC Assessment changed its classification from residential to business in a shift that is hitting resort properties around the province. At Pender Island's Poets Cove resort in the Gulf Islands, strata fees including taxes tack on almost $1,100 a month to the cost of a quarter share in a townhouse that is listed for sale at $229,000 for 12 weeks of occupancy a year.Some buyers are signing up for fractional ownership in vacation homes only to find long after the deal is sealed that the residential tax rate has given way to business and their costs are much higher than they expected."The developer comes in, sells the project and sells the management of it to a management company and he takes all the profit and gets out of Dodge," said Errol Winter, real estate director at Crown Isle, a resort and golfing community at Courtenay on Vancouver Island. "He's gone, the assessment comes in the following year, the taxes go through the roof and the management company is left holding the bag. "People are yelling." The controversy has prompted a review by the provincial government involving property taxes around short-term overnight commercial accommodation properties known more familiarly by the acronym STOCAP. Larger resorts with more than 20 units and fulfilling rental conditions that trigger the business assessment are affected by the higher taxes. The rules are outlined in assessment regulations governing the classification of STOCAPs.
(SEE LINK FOR FULL ARTICLE:) Canada.com
Taxes on one vacation unit in a Vancouver Island resort jumped
from $3,800 to $15,200 when BC Assessment changed its classification from residential to business in a shift that is hitting resort properties around the province. At Pender Island's Poets Cove resort in the Gulf Islands, strata fees including taxes tack on almost $1,100 a month to the cost of a quarter share in a townhouse that is listed for sale at $229,000 for 12 weeks of occupancy a year.Some buyers are signing up for fractional ownership in vacation homes only to find long after the deal is sealed that the residential tax rate has given way to business and their costs are much higher than they expected."The developer comes in, sells the project and sells the management of it to a management company and he takes all the profit and gets out of Dodge," said Errol Winter, real estate director at Crown Isle, a resort and golfing community at Courtenay on Vancouver Island. "He's gone, the assessment comes in the following year, the taxes go through the roof and the management company is left holding the bag. "People are yelling." The controversy has prompted a review by the provincial government involving property taxes around short-term overnight commercial accommodation properties known more familiarly by the acronym STOCAP. Larger resorts with more than 20 units and fulfilling rental conditions that trigger the business assessment are affected by the higher taxes. The rules are outlined in assessment regulations governing the classification of STOCAPs.(SEE LINK FOR FULL ARTICLE:) Canada.com
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