1) Q: What is the Vacant Home Tax?
A: The Vacant Home Tax is 1% of the Current Value Assessment (CVA) for the 2023 year and applies to Toronto homes declared, deemed, or found vacant for over 6 months in the previous year. The tax is based on the property’s occupancy status in the previous year.
2) Q: When was the Deadline?
A: The original deadline was February 29th but was extended to March 15th.
3) Q. What happens if you did not register by those dates?
A: There will be a late fee of $21.24 as well as a Notice of Assessment by the City. Meaning you will be notified about your non registration and what you will need to pay. Vacant Home Tax payments are due in three equal installment amounts on the due dates of May 15, June 17 and July 15, 2024. Failure to declare or making a false declaration may result in a fine of $250 to $10,000.
4) Q: What happens next?
A: Property Owners can disagree with the Vacant Home Tax Assessment can file a Notice of Complaint through the online portal beginning in early April if they meet certain criteria.
5) Q: What are those Criteria?
A: The VHT applies only to properties that are unoccupied for a total of six months or more during the calendar year by the owner or tenant. However, some properties can be granted exemptions in special circumstances.
These include cases in which the registered owner is deceased; the principal resident is in care; the home is vacant for renovations and repairs; a court order prohibits occupancy for at least six months; or cases in which the property is required for employment purposes for a total of at least six months by an owner who lives outside the Greater Toronto Area.
A developer who has constructed a new building can also apply for exemption for up to two consecutive years.
Multi-residential, commercial and industrial properties, as well as properties classified by MPAC as vacant land, parking space or a condominium locker, are not required to declare occupancy status.
6) Q: When should the Notice of Complaint be submitted?
A: For Vacant Home Tax Notice of Assessment: Any complaint must be received by the City on or before the last business day of the year that payment is due. For the 2022 taxation year, the complaint must be received by April 15, 2024. For the 2023 taxation year, the complaint must be received by December 31, 2024.
For Supplementary Vacant Home Tax Notice of Assessment: Within 90 days of the date on your notice.
Once all required information is received and a determination is made, the City will send a written decision letter to the owner by regular mail, at the mailing address on file at the time the decision is made.
Continue to pay the Vacant Home Tax as billed. If you do not pay the balance of the Vacant Home Tax prior to the due dates and your Notice of Complaint is not accepted, the tax will be due along with any applicable interest, penalties and fees.
If the property is determined not to be subject to the Vacant Home Tax:
The Vacant Home Tax will be cancelled, along with any applicable interest and penalties.
Any credits will be refunded or transferred to property tax.
Note that failure to pay the Vacant Home Tax by the due dates will result in interest and possible fees being added to the property tax account. Notice of Complaint decisions may not be finalized by the due date.
7) Q: Is there a possibility of appeal?
A: If you disagree with the decision made regarding your Notice of Complaint, you will have 90 days to submit an appeal request. The grounds of your appeal are limited to the same issues raised in your initial complaint, unless the outcome of your complaint resulted in a reassessment or varied assessment. The appeal decision is final.
8) Q: What Supporting documentation can be included?
A: These are:
- Ontario vehicle registration and vehicle insurance documentation showing subject address
- government-issued personal identification showing subject address, including driver’s license and Ontario Identity Card
- income tax returns and income tax notices of assessment showing subject address
- tenancy agreement(s) for the residential property
- bank statements showing reoccurring rental income
- copy of death certificate of the registered owner
- employment contracts, pay statements or records of employment showing subject address
- insurance certificates for homeowner’s or tenant’s insurance at subject address
- court orders prohibiting occupancy of the subject property
- signed letter from health care facility on letterhead with contact details for the care facility
- description of the type of project at the subject address along with any supporting documents (for example, work orders, contractor receipts) that demonstrate the occupation and normal use of the vacant unit was prevented by the repairs or renovations for at least six months in the taxation year
- copy of any building permits issued to the subject address related to repairs or renovations land transfer deed for the subject address
9) Q: How is the tax calculated?
A: For the 2022 and 2023 taxation years, a Vacant Home Tax of one per cent of the Current Value Assessment (CVA) will be levied on all Toronto residences that are declared, deemed or determined to be vacant for more than six months during the previous year. For 2024 and future taxation years, a tax of three per cent of the CVA.
10) Q: Who is responsible for making the occupancy status declaration? Seller or Buyer?
A: For property transferred prior to December 31 of the year being declared, the buyer must submit a declaration. The buyer qualifies for the “transfer of legal ownership” exemption.
For property transferred between January 1 and the closing of the declaration period on the last business day of February, the seller must complete the declaration prior to the closing. This is because only the seller will know the property’s occupancy status for the prior year.
11) Q: What happens if the previous owner did not make a declaration
A: The property will be deemed vacant and subject to the tax and fee.
The Vacant Home Tax forms a lien on the property, and the buyer will be held responsible for the payment of the tax.
For more information click here.
To start submition process of Notice of Complaint click here.
Photo by PiggyBank.