Application

1   (1) This regulation applies to money owed by the government on its own behalf

(a) for the provision to it of goods or services or both by any person, or

(b) as a consequence of an overpayment to it by any person.

(2) Subject to subsections (3) and (4), where the government has received money on account of taxes, royalties, fees or other charges payable under any Act in an amount that was correctly due or accruing due to the government according to the law and in the law and in the circumstances existing at the time the money was collected or paid, but subsequently, according to the law and in the circumstances existing at a later time, the government becomes obliged to refund the money, then the money that shall be refunded shall be treated as an overpayment for the purposes of this regulation, but only from the later of the day

(a) when the government becomes obliged to refund it, or

(b) when the person entitled to the refund has completed any procedures required at law to perfect the person's claim to the refund.

(3) Where the government becomes obliged to refund tax levied and collected by it under the Taxation (Rural Area) Act and Division 4 of Part 8 of the School Act after January 21, 1982, the provisions of subsection (2) (a) and (b) do not apply, and the refund shall be treated as an overpayment without condition.

(4) Notwithstanding anything in this regulation, where the government becomes obliged on or after March 1, 1984 to refund tax levied and collected by municipalities under Division 4 of Part 8 of the School Act, the provisions of regulations made under section 384 of the Municipal Act apply to that refund.

[am. B.C. Regs. 262/85; 30/2022, s. (a).]

Exceptions

2   This regulation does not apply to money owed by the government

(a) in the capacity of an agent or trustee,

(b) to a corporation, association, board or commission to which the Financial Information Act applies,

(c) to a regional hospital district as defined in the Hospital District Act,

(d) to a municipality or regional district to which a grant under the Local Government Grants Act may be made,

(e) to the government of Canada,

(f) for salary, wages, benefits or expenses owed by the government to an employee of the government in respect of that employment,

(g) under a contract where the contract specifically provides for payment of interest by the government, or

(h) where another enactment specifically provides for payment of interest by the government.

When interest accrues — goods and services

3   (1) Where section 1 (1) (a) applies to an account, the government shall pay interest on the money it owes on that account calculated from the 61st day after the day the money becomes due.

(2) For the purposes of subsection (1) the money becomes due when

(a) the appropriate ministry of government has received an invoice or a written request for payment, and

(b) the goods have been delivered in good condition or the services have been performed satisfactorily in accordance with the contract governing the supply of goods or provision of services.

(3) Subsection (1) does not operate to require the payment of an amount of interest less than $5.

When interest accrues — overpayments

4   (1) Subject to subsection (2.1), where section 1 (1) (b) applies to an account, the government shall pay interest on the money it owes on that account calculated from the later of

(a) October 1, 1980, or

(b) the 61st day after the day the government receives the overpayment.

(2) Subject to subsection (2.1), where section 1 (2) applies to an account, the government shall pay interest on the money it owes on that account calculated from the later of

(a) October 1, 1980, or

(b) the 61st day after the government becomes obliged to refund the money.

(2.1) Where section 1 (1) (b) or (2) applies to money owed by the government to a carrier, as that term is defined in the Motor Fuel Tax Act, as a result of money paid or purportedly paid to the government under or in accordance with one or both of the Motor Fuel Tax Act and the International Fuel Tax Agreement, the government shall pay interest on that money calculated from the 91st day after the day that the government receives the overpayment or becomes obliged to refund the money, as the case may be.

(3) This section does not operate to require the payment of an amount of interest less than $5.

[am. B.C. Reg. 558/95, s. (a).]

When interest stops accruing

5   Interest under section 3 or 4 stops accruing on the date payment of the money owed is mailed to the person to whom it is owed, or, if delivered to the person without mailing, the date of delivery.

[am. B.C. Reg. 30/2022, s. (b).]

Rates of interest

6   (1) The rate of interest payable for section 4 (1) or (2) shall be

(a) Spent.

(b) during each successive 3 month period, beginning on October 1, January 1, April 1 and July 1 in every year, 2% below the prime lending rate of the principal banker to the Province on the 15th day of the month immediately preceding that 3 month period.

(1.1) The rate of interest payable for section 4 (2.1) shall, for each 3 month period beginning on January 1, April 1, July 1 and October 1 in every year, be 2% above the Canadian Federal Treasury Bill rate on the 15th day of the month immediately preceding that 3 month period.

(2) The rate of interest payable on any other account payable overdue shall, between July 1, 1983 and September 30, 1992, be

(a) Spent.

(b) during each successive 3 month period, beginning on October 1, January 1, April 1 and July 1 in every year, 1 1/2% above the prime lending rate of the principal banker to the Province on the 15th day of the month immediately preceding that 3 month period.

(3) During each successive 3 month period beginning on October 1, January 1, April 1 and July 1 in every year, the rate of interest payable on any account payable overdue referred to in subsection (2) shall, commencing October 1, 1992, be 3% above the prime lending rate of the principal banker of the Province on the 15th day of the month immediately preceding that 3 month period.

[am. B.C. Regs. 304/92; 558/95, s. (b).]

Method of calculation

7   On money owed by the government, interest shall be

(a) compounded monthly, and

(b) calculated on the number of days since the last compounding of interest or, where no compounding has yet occurred, since the interest commencement date.