top of page

Vacant Home Tax

Writer's picture: JH BlogJH Blog

Updated: Mar 7, 2023

Toronto’s new annual tax on vacant residences commences on January 1, 2023 and it will have a significant impact on how real estate transactions take place.


If a residential unit was vacant in the year prior to a sale, or if a seller did not file the city’s required property status declaration, the purchasers could be fine for penalties of up to $10,000.00. In which case, it will be added to the tax account.


In order to protect you, the buyer, our team will now require the sellers to deliver copies of the filed property status declaration as part of the closing process.


All owners of residential property in the City of Toronto must file an online declaration of the occupancy status of their property before February 2, 2023. Anyone who fails to file a declaration is liable to a fine of between $250.00 and $10,000.00. If the home was in fact empty, there is a tax of one per cent (1%) of the current value assessment. This amount will get added onto the tax bill for the for the property and, if it is sold, the new owner could unknowingly get stuck with payment after closing.


Vacant Home Tax

Homeowners who choose to keep their properties vacant are subject to the tax. A unit is classified as vacant if, for more than six months in the previous taxation year, it was not the principal residence of the owner or another occupant, or if it is not occupied by a residential tenant under a written lease for at least six months of the year.


Vacant Home Tax Exemption

The property is exempt from the Vacant Home Tax if:


1. The unit was vacant for six months or more due to the death of an owner.

2. The property is undergoing renovations or repairs, and the normal use is prevented by the need for the work, all necessary permits have been issued, and the chief building official is of the opinion that the work being carried out is without unnecessary delay.

3. The principle resident is in the hospital or a long-term care facility for at least six months during the taxation year.

4. The property was purchased in the previous year


The unit needs to be lived in for employment purposes by its owners for at least six months, if the owner lives outside the Greater Toronto Area (GTA)

0 comments

Comments


JH Law Professional Corporation
Address • 
505 Consumers Rd, Suite 903, Toronto, Ontario, Canada M2J 4V8

Email info@jhlaw.ca • Phone 416-546-3638 • Fax 647-699-7270 

© 2024 by jhlaw.ca

bottom of page