Toronto’s New Vacant Home Tax – Declarations Due by February 2, 2023
In an attempt to increase the supply of housing and to discourage homeowners from leaving their residential properties unoccupied, the City of Toronto has implemented a Vacant Home Tax and declaration reporting requirements. All residential property owners in Toronto will now be required to declare the occupancy of their property on an annual basis. The City of Toronto has sent out notices by mail containing the information required to make a declaration for 2022.
Vacant Home Tax Calculation:
A Vacant Home Tax of one per cent (1%) of the Current Value Assessment of the property will apply to residences that are vacant or deemed vacant for more than six months during the previous calendar year. For example, if the home is vacant in 2022 the tax will become payable and due by May 1, 2023.
Vacant Home Meaning:
A residential property is considered vacant where the property is not the owner’s principal residence and has been unoccupied for a total of six months throughout the previous year or is otherwise deemed vacant under the City of Toronto bylaw. The six-month period does not have to be consecutive and there are certain exemptions that may apply.
Making a Declaration:
- All residential property owners in Toronto are required to declare the occupancy status of their property even if the property is occupied.
- The declaration of occupancy status is made through the City of Toronto’s online declaration portal or a paper declaration. For the year 2022, declaration forms must be completed and received by the City of Toronto by February 2, 2023.
- For residential properties that are occupied, but not by the homeowner(s), owners will be required to submit information about tenants and/or permitted occupants when making the declaration.
- Owners of properties subject to the tax will be issued a Vacant Home Tax Notice in March or April and payment will be due by May 1.
Eligibility exemptions include situations where there is a death of the registered owner; where the principal resident is in a hospital, long-term or supportive care facility; the property is required for full-time employment; legal ownership was transferred in the previous year; there is a court order that prohibits the occupancy; or the property is undergoing major repairs or renovations. These exemptions must be noted on the declaration and supported by required documentation.
Penalty for Late or False Declaration:
A late declaration or failure to make a declaration and/or provide supporting documentation, will result in a minimum fine of $250 and may result in a property being deemed vacant. Once deemed vacant, the property owner will be subject to the Vacant Home Tax and will be issued a Vacancy Tax Notice. A false declaration may result in a fine of $250 to $10,000 for each offence.