BC PST Expansion (October 1, 2026)

Definition

The BC PST Expansion is a legislative change, effective October 1, 2026, that broadens the list of taxable services under the Provincial Sales Tax Act (BC) to include several categories of professional services that were previously exempt. The stated purpose is to align PST treatment with other sales-tax jurisdictions and to broaden the provincial revenue base. The expansion was announced in the BC Budget and receives effect through amendments to the PST regulation.

Key rules

Services becoming taxable at 7% on or after October 1, 2026:

• Accounting and bookkeeping services.
• Architectural services.
• Engineering services.
• Geoscience services.
• Security and investigation services.
• Real estate services (including residential and commercial brokerage commissions).

Services NOT included in the current expansion:

• Pure IT consulting and custom software development (software licences and SaaS are already taxable).
• Management consulting.
• Marketing, advertising, and design services.
• Medical, dental, veterinary, and most health services.
• Legal services (already taxable since 2013).

Example

A BC CPA firm currently bills $250,000 annually in accounting and tax services to BC clients. Under current rules, no PST is charged. Effective October 1, 2026, all invoices for accounting and bookkeeping services must include 7% PST.

For an engagement completed September 28, 2026 with invoice issued October 5, 2026:

• If the service was performed before October 1, PST generally does not apply under transitional rules based on the earlier of invoice date and service completion date.
• If the service spans the transition date, the Ministry bulletin should specify proration rules. The firm should confirm the transitional rule before issuing invoices that straddle the date.

The firm must register for PST (if not already registered), configure its invoicing system to add a 7% PST line for accounting services from October 1, and file its first PST return covering the transition period on the assigned due date.

Common mistakes

• Assuming IT consulting is captured. As of the current legislation, it is not; but the Ministry has flagged "digital services" as an area of ongoing study.
• Failing to register before October 1, 2026. Firms that were previously exempt (accountants, engineers, architects) must complete PST registration in advance to collect from day one.
• Not updating client contracts. Fixed-fee engagements that were quoted before the change must be renegotiated or absorb the PST depending on contract language.
• Missing the transitional rule. A service performed in September 2026 but invoiced in November 2026 may still be exempt if the service was completed before the transition date.

Related concepts