From BC Assessment
Farm land: A warning to potential purchasers
BC Assessment wishes to remind lawyers, notaries and realtors whose clients are purchasing land classified as farm for property tax purposes that specific requirements must be met for that property to continue to qualify for farm classification. Those requirements are set out in the Assessment Act RSBC 1996, c.20 and BC Reg. 411/95 (Standards for the Classification of Land as a Farm Regulation). In particular, the regulation requires a specified amount of "primary agricultural products" to be produced and sold by October 31 to qualify the land for farm class in the following year.
The regulation also requires the completion of an application form by October 31 for any new farm to enable farm class to be granted the next tax year. The assessor may require new owners of existing farms to file an application for farm class. Also, at any time during the year, the assessor may require the provision of farm income details or other information to support the continuation of farm class.
If requirements are not met, the assessor is required to deny or remove farm classification for the following year. Typically this means the land will change to Class 1 (residential) or Class 6 (business and other). These classes typically have higher tax rates and higher land values than farm land. Land classified as farm is valued by rates set by the assessment commissioner, reflecting only the value of the land in farm use, not necessarily highest and best use.
Further information on farm assessment can be obtained from the BC Assessment website at www.bcassessment.bc.ca, through a local assessor or by contacting the farm appraiser in Cost and Legislated Assessment Services, BC Assessment Head Office, 1537 Hillside Avenue, Victoria, BC V8T 4Y2 (Tel. 250 595-6211).