Have you paid PST on purchased capital assets or leased assets after September 17, 2020?
On September 17, 2020, the Government of BC announced a Provincial Sales Tax (PST) Rebate for select machinery and equipment. The Government of BC has extended this program by 6 months to March 2022.
When an incorporated business purchases or leases certain machinery and equipment between September 17, 2020 and March 31, 2022, they may be eligible for a rebate of 100 percent of BC PST paid. Certain entities are excluded from eligibility, such as Crown corporations, charities, schools, and hospitals.
The machinery and equipment that qualify for the rebate must be:
- Certain CCA classes found in Schedule II to the federal Income Tax Regulations;
- Obtained substantially (90 percent plus) for the purpose of gaining or producing income; and
- Not excluded (see below).
The following goods are excluded from the rebate:
- Vehicles, with the exception of zero-emissions vehicles;
- Goods that will be installed as an improvement to real property;
- Goods purchased for resale by a small seller; and
- Exclusive products purchased by independent sales contractors.
Software and goods, other than goods obtained by lease, must be capital assets for the rebate to apply. Further, the assets may not be eligible for a refund under any other existing PST regulation.
CCA classes covered by the rebate include, but are not limited to:
- Machinery and equipment, tools, appliances and furniture;
- Computer hardware and software;
- Electric vehicle charging stations; and
- Zero-emission vehicles.
Incorporated businesses may make up to three PST rebate applications:
- First application between April 1, 2021 and September 30, 2021
- Second application between October 1, 2021 and March 31, 2022
- Third application between April 1, 2022 and September 30, 2022
The applications must be made electronically, either using your eTaxBC login or through the Government of BC’s online portal for applications.
Our indirect tax team are here to help with any questions or provide assistance with preparation of the rebate or any other indirect tax matters.
