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Vancouver homeowner avoids paying empty homes tax after winning court battle

The property that sits at 4749 Belmont Avenue in Vancouver. The owner of the property has won a court battle over paying the city's empty homes tax.
The property that sits at 4749 Belmont Avenue in Vancouver. The owner of the property has won a court battle over paying the city's empty homes tax. Google Street View

The owner of a multi-million-dollar Vancouver property will get another chance to make her case against paying an expensive empty homes tax after winning a court battle with the city.

In a decision posted Friday, a B.C. Supreme Court judge ruled the City of Vancouver should undertake a new review of whether the tax should be levied against 4749 Belmont Avenue.

The oceanview property in West Point Grey was assessed last year at $26,789,000, but only $10,000 of that value was for the home itself.

READ MORE: City of Vancouver facing multiple lawsuits over empty homes tax

Owner Yi Ju He, who purchased the property in 2015, had argued the city unfairly charged her the tax while she was waiting for permits to be approved to allow for redevelopment.

According to the court ruling, He was looking to replace the existing home with a new structure, and had run into issues with the removal, including the discovery of asbestos on the site.

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He and her lawyers submitted various permit applications to the city in early 2017, before she submitted her empty home tax form for the 2017 tax year asking for an exemption. The ruling notes only some of the permits had been approved by summer 2018 — months past the tax filing deadline.

Provincial rules stand in way of more empty homes taxes in B.C.
Provincial rules stand in way of more empty homes taxes in B.C.

The empty homes tax bylaw requires homeowners to prove their homes are occupied for at least six months out of the year by either themselves or renters. Otherwise, they’re charged an additional one per cent tax on the property’s assessed value.

Although the bylaw allows exemptions if properties are being redeveloped for more than six months of the year, the city denied He’s request for an exemption and charged her the empty homes tax, which for He amounted to $249,313.67.

After He filed a complaint, a vacancy tax review officer ruled He had not proved the home had been empty because of redevelopment.

READ MORE: Vancouver’s empty homes tax should stay at 1% to ensure it’s still being paid: staff

He’s lawyers then requested a review of the city’s decision, which was also denied after the review panel determined He’s evidence didn’t bring her “within the requirements of a redevelopment application,” according to the ruling.

In her ruling, Justice Shelley Fitzpatrick noted the vacancy tax review officer and the review panel both received advice from city employees about He’s permit applications, but didn’t tell her about it.

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In the lawsuit she filed earlier this year, He argued for an oral hearing to further plead her case.

City of Vancouver releases empty home tax revenue total
City of Vancouver releases empty home tax revenue total

While Fitzpatrick declined to order an oral hearing specifically, she did note the city had acknowledged the decisions by the vacancy tax review officer and the review panel “did not meet the requirements of procedural fairness.”

The judge then ordered the matter to be sent back to a new vacancy tax review officer for review.

He’s lawsuit was one of at least four launched against the city earlier this year over the empty homes tax.

READ MORE: Vancouver to hike empty homes tax by 25%

A developer behind one of those lawsuits, Pure West Financial Holdings Group Inc., also took issue with the city over delays in approving permits for redevelopment.

The City of Vancouver collected $38 million in revenue through the empty homes tax for the 2017 tax year, and another $39.4 million for the following year. All of that revenue is earmarked for affordable housing projects.

City council recently approved raising the tax from one per cent to 1.25 per cent in 2020, while leaving the door open for additional 25 per cent hikes in 2021 and 2022.

The city also approved an amendment to the bylaw that adds together the tenancy time and the amount of time spent qualifying for permits to renovate or redevelop properties.

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