BC Prov Sales Tax (PST) on Property Management Fees?
By Alvin Cheung, CFA, President at Birds Nest Properties
Short answer: Most residential property owners in Vancouver will not be impacted by the new 7% PST on management fees. This tax specifically targets commercial and non-residential real estate services starting October 1st, 2026.
The BC Budget 2026 announced a significant change to how Provincial Sales Tax (PST) is applied to professional services, including property management fees.
At Birds Nest Properties, many of our clients have been asking: “Will I see a 7% increase in my management fees this year?” Here is the essential breakdown of the new rules and how they affect your specific investment properties.
What is Changing?
Beginning on October 1st, 2026, the BC government will expand the 7% PST to include several professional services that were previously exempt. According to the government’s Notice 2026-001, this includes accounting, engineering, and non-residential real estate services.
How This Affects Your Portfolio
The impact of this tax depends entirely on the classification of your property.
1. Residential Rental Properties (Exempt)
If you own a standard residential rental—such as a detached home, a condo, or a townhouse—your property management fees remain PST-exempt. The new legislation specifically targets “non-residential” services. Because Birds Nest Properties is primarily a residential property management company, the vast majority of our owner clients will see no change in the taxes applied to our management fees.
2. Commercial Properties (Taxable)
For owners of commercial real estate (e.g., retail spaces, offices, or industrial units), however, the landscape is changing. Effective October 1, 2026, the professional fees you pay for rental property management and strata management will be subject to the 7% PST.
3. Mixed-Use Buildings
If you own a “mixed-use” property—typically a building with commercial storefronts on the ground floor and residential units above—the tax will likely be applied proportionally.
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- Fees for managing the residential units remain exempt
- Fees for the commercial units will become taxable.
Frequently Asked Questions (FAQ)
Will my property management fees go up because of this?
For our residential clients, there is no tax-related increase. For commercial clients, the base fee remains the same, but we will be required by law to collect an additional 7% PST on behalf of the provincial government starting October 2026.
Is the PST refundable like the GST?
No. Unlike GST, PST in British Columbia is generally a “sunk cost” for businesses and is not refundable through Input Tax Credits. This makes it even more important to ensure your property is correctly classified.
What if I have a commercial tenant in a residential building?
If the property is legally classified as “mixed-use,” only the portion of the management fee attributed to the commercial unit will be subject to the 7% PST.
Does this new PST apply to my residential Airbnb or short-term rental?
No. The current provincial guidance classifies these as residential real estate services, which are not included in the new PST expansion.
We are currently awaiting the final regulations from the Ministry of Finance to confirm exactly how these fees must be split or itemized on your owner statements. If you have questions about how these taxes may apply to your investment property, call us at 604.260.9955.
Disclaimer: This article is for informational purposes only and does not constitute legal or tax advice. We recommend consulting with a professional tax accountant regarding your specific property portfolio and tax obligations.
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Read more Birds Nest Properties Landlord Guides:
Key BC Tenancy Rules at a Glance for Landlords in 2026
BC Prov Sales Tax (PST) on Property Management Fees?
Ending Tenancy for Landlord or Purchaser Occupancy
Furnished vs Unfurnished for Your Rental Property?
Understanding Vancouver Property Management Fees
BC Speculation and Vacancy Tax – 2026 Landlord Guide
Vancouver Empty Homes Tax – 2026 Landlord Guide
Repairs & Maintenance: Does Landlord or Tenant Pay?
8 Essential Preparation Tips for First-Time Landlords
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Birds Nest Properties is a leading rental property management company in Greater Vancouver specializing in long-term tenancies for condos, houses, and apartment buildings.
We take care of everything, so you don’t have to. Our comprehensive service gives you a stress-free experience as a rental property owner.
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