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Frequently Asked Questions
Questions:
How is interest calculated? |
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Interest is assessed if the instalment payments, final payment, or payments on account are not received by the due date. Interest rates are reviewed quarterly. Please see Make a Payment and Interest Rates for more information. |
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The tax rate is 2% of the net taxable premiums for life, accident and sickness, and loss of salary or wages insurance. Effective January 1, 2004, the tax rate for property and automobile insurance is 4.4%. The tax rate is 4% for all other contracts of insurance. |
How is the instalment amount calculated?
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Quarterly instalments are required if the previous year's taxes were more than $25,000. The required instalment amount is either ¼ of the previous year's taxes or ¼ of the current year's estimated taxes.
Interest charges will apply if the current year's instalments are less than both the previous and current year's actual taxes payable. See Make a Payment for more information. |
When are instalments due?
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Instalments are due June 15th , September 15th and December 15th, with the final payment due on or before March 31st of the following year. |
Who can I contact about my Insurance Premium Tax?
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Insurance Premium Tax is administered by the Income Taxation Branch of the Ministry of Finance. There are a number of ways you can contact us. |
How do I obtain a copy of the tax return and guide?
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Please see our Forms page to download these documents. Or, you can contact us to have copies mailed to you. |
How much money do I have in my instalment account?
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Due to confidentiality, we will confirm an amount by telephone but will not disclose information unknown by a taxpayer. A completed Authorization Form (FIN 573) must be submitted before we can release information to your accountant or other representative. Please see our Forms page to download the Authorization Form. |
Have you received my payment?
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Payments are reflected on your Statement of Account, which we send out one day after your payment has been processed, or on your instalment coupon, which we send quarterly. |
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Refunds are normally mailed out within three weeks of a return being assessed. |
What is an unlicensed insurer?
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Generally, an unlicensed insurer is any insurer who is not authorized to carry on insurance business in British Columbia. |
How will I know if the company I buy insurance from is unlicensed?
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The Financial Institution Commission (FICOM) maintains a list of authorized insurers. If your insurer is not on this list, it is likely an unlicensed insurer. To obtain a copy of the list, contact FICOM or visit their website at
www.fic.gov.bc.ca (opens in a new window). |
Do I have to pay the Insurance Premium Tax?
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If you have purchased insurance from an unlicensed insurer, it is your responsibility to calculate the amount of tax you owe and pay the government. |
How much tax do I have to pay?
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The Insurance Premium Tax is 7% on insurance purchased from an unlicensed insurer. You must pay 7% of the total premiums you pay to insure residents of or property located in British Columbia. |
How do I pay the Insurance Premium Tax? |
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If you purchase insurance from an unlicensed insurer, you must complete the Unlicensed Insurance Tax Return (FIN 521) within 90 days of the purchase. Often an insurance broker will file on behalf of the client. You can authorize your broker to file on your behalf by completing an Authorization Form (FIN 573). Please see Make a Payment for more information. |
My company is a subsidiary of a foreign corporation. The head office purchases all the insurance. Does my company have to pay the tax?
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If the insurance company is not on FICOM's list of authorized insurers and your business has a permanent establishment in B.C., your company will have to pay the tax. Since your head office purchased the insurance on your behalf to cover residents of B.C. or property located in B.C., your subsidiary must pay the tax. |
Can I make instalment payments? |
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When agreed upon, short term payment arrangements are considered for a period of six months or less. For approval of payment proposals which are longer than six months, you will be asked to provide detailed financial information, and it will be necessary to secure the debt by registering a lien against your property. Interest continues to accrue on all unpaid balances. |
Do you accept credit card payments? |
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No, we do not accept credit card payments. |
Are you a private collection agency? |
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No, we are not a private collection agency. The Receivables Management Office is a branch of the Ministry of Finance that collects outstanding taxes owing to the province. |
What do you mean by "Legal Action"? |
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The province has available remedies that it may use to collect overdue taxes under its various tax statutes. These remedies include:
- Demands on bank accounts
- Employers and third parties
- Liens
- Certificates of Judgement
- Federal Government refund set-offs
- Writs of Seizure and Sale
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Will legal actions have an effect on my (my company) credit rating? |
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This will depend on the collection action which has been undertaken in an attempt to collect the outstanding balance. |
Why have I received a notice from the Land Title Office telling me a Judgement is registered on my property? |
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The Land Title Office is required to send you a notice informing you that a lien has been registered on your property. This notice gives you an opportunity to dispute the lien if you believe the lien has been filed in error. You may receive this notice after your account has been paid or reversed. |
When will the lien on my property be removed? |
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We will remove all collection action including a property lien once you have paid the account in full or the assessment of tax has been reversed. |
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There are several ways in which you can pay. Please see Make a Payment for details. |
What should I do if I disagree with the amount I owe? |
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If you disagree or do not understand it and would like more information, please call the number indicated on your notice or call 1-800-361-5050. |
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