The second half of 2026 brings the most consequential change to British Columbia's sales tax base in years — one that reaches directly into the cost of professional advice, including our own. Alongside it sits a cluster of payroll, credit, and compliance changes that BC businesses need to map before year-end. This is that map: what changes, when, and what it means for your costs.
We serve BC clients from our Vancouver office, so we will be transparent about the headline item rather than tuck it away — it affects the fees you pay for certain services, and we would rather you hear how it works from us.
The lead change: PST on professional services from October 1, 2026
Effective October 1, 2026, BC PST (7 percent) applies to a range of previously exempt professional services — and the list explicitly includes accounting, bookkeeping, and assurance services, along with non-residential real estate services and security services. Providers of these services must register for PST and charge it, and every BC business that buys these services will see the associated cost rise by the tax.
What this means for you, and what we are doing about it: where a service RN Canada provides to a BC client becomes PST-taxable under the new rules, PST will appear on the invoice from October 1 onward — it is a tax we are required to collect and remit, not a fee increase. We are reviewing our BC engagements now so that the transition is clear on every invoice, so there are no surprises in Q4, and so that, where PST is recoverable or plannable in your particular situation, that is flagged to you rather than left for you to find. If you have questions about how the change touches your specific services, we would rather have that conversation early than at the October changeover.
Source: Government of British Columbia — Budget tax changes.
Source: Government of British Columbia — PST notice on professional services.
The PST base expands further on the same date
October 1 is a broader base-broadening date than the professional-services headline alone. On the same date, PST also begins to apply to clothing-making inputs (patterns, yarn, and fabric), services related to clothing and footwear, basic cable television, and toll-free and residential landline telephone services.
For BC businesses in apparel, retail, telecommunications-adjacent services, and any operation that consumes these newly taxable inputs, the practical task is to check purchasing and pricing before October 1 — both what you now pay PST on and, if you supply any of these categories, what you must now charge.
Source: Government of British Columbia — Budget tax changes.
Minimum wage: $18.25 an hour, the highest provincial rate in Canada
BC's payroll floor rose on June 1, 2026, to $18.25 per hour (from $17.85) — the highest provincial minimum wage in Canada. The engaged-time rate for ride-hail and delivery workers is $21.89. Because the increase took effect at the start of June, the second half of 2026 is the first full stretch of payroll to absorb the new rate.
For BC employers running near the wage floor — hospitality, retail, care services — the H2 impact flows through not just base pay but the statutory costs layered on top of it. Build the full-rate figure into your Q3 and Q4 labour forecasts rather than the transitional average.
Source: Government of British Columbia — Minimum wage.
A new BC Manufacturing and Processing tax credit
On the incentive side, BC introduced a new temporary refundable Manufacturing and Processing investment tax credit worth 15 percent of eligible M&P building and machinery investments by Canadian-controlled private corporations, on up to $2 million of investment — a maximum credit of $300,000. It is effective April 1, 2026 and runs to March 31, 2031.
For BC manufacturers and processors weighing capital investment, this refundable credit improves the after-tax cost of qualifying buildings and machinery. If a plant or equipment project is planned for the second half of the year, confirm the eligibility and timing so the investment falls squarely within the credit window.
Source: Government of British Columbia — Budget tax changes.
SR&ED: the federal expansion, with BC's credit aligned
Research-active BC companies benefit from the same federal SR&ED expansion enacted through Bill C-15: the enhanced expenditure limit rises from $3 million to $6 million, capital expenditures are eligible again, and the taxable-capital phase-out band moves to $15 million–$75 million, applying to tax years beginning on or after December 16, 2024. BC's provincial SR&ED credit is aligned to match the federal changes.
For a BC innovator, the combined federal-plus-provincial position on R&D spend is more generous than it was — worth revisiting before any second-half year-end closes.
Source: CRA — SR&ED program updates.
Source: Government of British Columbia — Budget tax changes.
WorkSafeBC: average base rate flat, but industry rates moved
The WorkSafeBC 2026 average base premium rate holds at $1.55 per $100 of assessable payroll — the ninth straight year at that level. But the average conceals movement: individual industry-level rates shifted, with some rising up to the 10 percent annual cap. The flat headline does not guarantee your own classification held steady.
The action for H2: confirm your own industry rate rather than assume the average, and watch for the 2027 preliminary rates, which are announced in the fall of 2026.
Source: WorkSafeBC — 2026 industry premium rates.
Bare trusts: T3 and Schedule 15 for years ending on or after December 31, 2026
The federal bare-trust reporting rules reach BC arrangements just as they do elsewhere. Bare trusts must file a T3 return with Schedule 15 for taxation years ending on or after December 31, 2026. Certain exemptions have been proposed, but do not plan around relief that is not yet confirmed.
The H2 action is to identify nominee and bare-trust arrangements now — property held in one name for another's benefit, in-trust accounts, and similar structures — so the first filing is prepared rather than discovered.
Source: CRA — New trust reporting requirements for T3 filing.
Speculation and vacancy tax: a 2027 planning item to flag now
For affected owners, one rate change is scheduled ahead. The BC speculation and vacancy tax rate for foreign owners and untaxed worldwide earners rises from 3 percent to 4 percent for the 2027 calendar year. It does not bite in 2026, but the planning window is now.
If you hold BC residential property through a structure that attracts the higher rate, the second half of 2026 is the time to review ownership and use before the increase takes effect.
Source: Government of British Columbia — Budget tax changes.
What is not changing: Employer Health Tax and the payroll baseline
Two anchors hold steady, which is worth stating plainly. The Employer Health Tax has no change for 2026: the exemption stays at $1,000,000 ($1.5 million for charities and non-profits), with the 5.85 percent notch to $1.5 million and a 1.95 percent flat rate above it. And the federal payroll baseline matches every province — CPP YMPE $74,600, CPP2 ceiling $85,000, EI $1.63 employee / $2.28 employer, maximum insurable earnings $68,900.
Source: Government of British Columbia — Employer Health Tax overview.
Source: CRA — CPP contribution rates, maximums and exemptions.
Source: CRA — EI premium rates and maximums.
Two more items of context
For completeness on the cost side: the BC consumer carbon tax remains repealed (it ended April 1, 2025), and the capital gains inclusion rate stays at 50 percent after the proposed increase was cancelled — the same certainty that applies nationally.
Source: Government of British Columbia — Carbon tax elimination.
Source: Department of Finance Canada — capital gains inclusion rate.
Key takeaways
- From October 1, 2026, BC PST (7 percent) applies to accounting, bookkeeping, and assurance services, plus non-residential real estate and security services — providers register and charge; buyers pay more.
- The same date broadens PST to clothing-making inputs, clothing/footwear services, basic cable TV, and toll-free/residential landline phone services.
- BC minimum wage is $18.25/hr (from June 1, 2026) — the highest provincial rate; the engaged-time ride-hail/delivery rate is $21.89.
- A new BC M&P investment tax credit gives CCPCs 15 percent on up to $2M of investment (max $300,000), April 1, 2026 to March 31, 2031.
- SR&ED expands federally ($3M→$6M, capital back, $15M–$75M phase-out); BC's credit is aligned.
- WorkSafeBC average base rate holds at $1.55/$100, but industry rates moved (up to +10 percent cap) — check your own; 2027 preliminary rates come in fall 2026.
- Bare trusts file T3 + Schedule 15 for years ending on or after December 31, 2026 — identify arrangements now.
- The speculation and vacancy tax rises 3 percent → 4 percent for 2027 for foreign owners and untaxed worldwide earners — a 2026 planning item.
- No EHT change for 2026 ($1M exemption); the CPP/CPP2/EI baseline matches every province.
The H2 2026 map for BC businesses is dominated by the October 1 PST expansion, but the payroll, credit, and compliance items around it each carry their own timing. If you want the professional-services PST change — or any of these items — mapped onto your own BC operations before Q4, RN Canada works with clients on both sides of the Rockies and can walk through exactly what applies to you.