The Province of British Columbia has announced one of the most significant changes to Provincial Sales Tax (PST) in recent years. Beginning October 1, 2026, PST will apply to several professional services that have historically been exempt from the tax.
The changes will have implications for both businesses that provide these services and the organizations that purchase them. With the implementation date approaching, businesses should understand how the new rules may affect their registration requirements, billing practices, contracts, and overall costs.
Which Services Will Become Subject to PST?
Effective October 1, 2026, the 7% PST will apply to several categories of professional services, including:
Accounting services, including bookkeeping, tax, assurance, and audit services
Architectural services
Engineering and geoscience services
Security services, including private investigation services
Non-residential real estate services, including:
Commercial real estate commissions
Rental property management services
Strata management services
Businesses providing these services will generally be required to register for PST, collect the applicable tax on taxable services, and remit it to the Ministry of Finance.
For businesses operating in one of these sectors, now is the time to review existing processes and determine what changes may be required ahead of October 1.
Special Rule for Engineering, Geoscience, and Architectural Services
A notable special rule applies to architectural, engineering, and geoscience services.
Rather than applying PST to the full purchase price, PST will generally apply to 30% of the purchase price of these services.
For example:
Engineering fee: $10,000
Taxable portion: $3,000 (30%)
PST at 7%: $210
In this example, the resulting PST is effectively 2.1% of the total service fee.
Businesses purchasing or providing these services should ensure they understand how the special calculation applies and that their invoicing and accounting systems are prepared to handle it correctly.
Who Needs to Register?
If your business provides any of the newly taxable services and is not already registered for PST, you may now be required to register with the Ministry of Finance.
The Province began accepting PST registrations from affected businesses on April 1, 2026, giving organizations time to prepare before the new rules take effect.
Businesses should review their service offerings and registration requirements well in advance of October 1. This is also an important time to ensure invoicing, bookkeeping, accounting software, contracts, and internal processes are prepared to properly collect and account for PST once the changes take effect.
What Does This Mean for Businesses Purchasing These Services?
For many businesses, the changes will result in a direct increase in the cost of professional services. Unlike GST, PST is generally not recoverable through an input tax credit system, meaning the tax may represent an additional cost to the purchaser.
Organizations that regularly engage accountants, bookkeepers, property managers, security providers, engineers, architects, or commercial real estate professionals should consider how the new rules may affect their budgets, project costs, contracts, and cash flow.
Businesses entering into new agreements or budgeting for professional services extending beyond October 1, 2026, should also consider whether PST will apply to those costs.
Are There Exemptions?
The Ministry of Finance has confirmed that exemptions and special rules may apply depending on factors such as the nature of the service, the location of the purchaser, and how the service is used. Additional administrative guidance is also continuing to be released as businesses prepare for implementation.
Because the rules and potential exemptions vary by service type and circumstance, businesses should review their specific situation rather than assuming a particular service will—or will not—be subject to PST.
With October 1 approaching, proactive planning can help businesses avoid surprises and ensure they are prepared for the transition. If you have questions about how B.C.’s upcoming PST changes may affect your business, the Empire CPA team is available to help you understand your obligations and prepare for the new requirements.
How Empire CPA Can Help
If you need help setting up eTaxBC, updating your accounting software, or reviewing project contracts for PST exposure, contact our team today.
If you’d like to learn more about the new changes, click the link below.
Canadian and foreign tax laws are complex and have a tendency to change on a frequent basis. As such, the content published above is believed to be accurate as of the date of this post. Before implementing any tax planning, please seek professional advice from a qualified tax professional. Empire, Chartered Professional Accountants will not accept any liability for any tax ramifications that may result from acting based on the information contained above.