How to File

Logging Tax Returns must be filed within six months of the end of the taxation year in which the logging operations occurred. The return form can be downloaded off our Forms page. Please see Make a Payment for information on paying your Logging Tax.

A signed copy of the Logging Tax Return must be mailed to:

Ministry of Small Business and Revenue
Income Taxation Branch
PO BOX 9444 STN PROV GOVT
VICTORIA BC  V8W 9W8

The postmark date on the envelope is accepted as the filing date.

For returns that are sent by courier or fax, the date the return is received by the ministry is considered the filing date:

Fax: 250-356-0434

Courier:
Ministry of Small Business and Revenue
Income Taxation Branch
1st Floor 1802 Douglas Street
Victoria BC V8T 4K6

A copy of your federal income tax return and financial statements must be submitted with the Logging Tax Return.

If the return indicates a balance of tax owing, a cheque or money order made payable to the Minister of Finance should accompany the return.

If logging operations cease, please notify the Commissioner of Income Tax in writing (same addresses as above). You will no longer be required to file a Logging Tax Return unless you resume logging activities in the future.

Calculation of Tax

Logging income is calculated in accordance with Division B of the Income Tax Act (Canada) and is generally gross revenue from logging operations less related operating expenses.

If logging income is recorded as a capital gain, the logging tax applies to the taxable portion of the capital gain.

Where logs are manufactured into primary and secondary forest products, a processing allowance may be deducted.

The processing allowance is calculated as 8% of the original cost of assets used to produce primary and secondary forest products. The allowance may not exceed 65% nor be less than 35% of the net processing income (calculated as total income from all sources less income from the sale of logs or standing timber and non-logging income).

For each taxation year, a taxpayer must pay a tax equal to the lesser of:

	10% of the taxpayer's income from logging operations in British Columbia, or
	150% of the credit that would be allowable under Section 127(1) of the Income Tax Act, as if the tax referred to in paragraph (a) was paid.

On March 29, 2001, the Logging Tax Act was amended: the allowable deduction under section 127(1) of the Income Tax Act is the logging tax deduction that would be allowable before any deduction is made for investment tax credits or political contribution credits. This change is applicable to taxation years beginning after March 31, 2001.

The amount of logging tax paid is usually fully deductible as a credit from income taxes if claimed within three years of filing a federal income tax return. Please contact the Canada Revenue Agency for more information (opens in new window).