The NEW Toronto Vacant Home Tax -Everything You Need to Know About

Are you a City of Toronto homeowner?
If so, you would have acquired a yellow letter from the City asking you to post a statement shape by way of Feb 2, 2023 about the occupancy popularity of your residential properties in Toronto in 2022.
The motive of this Toronto Vacant Home Tax is to “increase the grant of housing by using discouraging proprietors from leaving their residential homes unoccupied”. For householders who depart their homes vacant for greater than 6 months in the course of the preceding 12 months and do no longer meet the definition of any of the exemptions, you’ll be required to pay the Vacant Home Tax.
This Vacant Home Tax is calculated as: 1% of Current Value Assessment.
If your residence is really worth $1,000,000, this vacant domestic tax can be $10,000. Annually!
You don’t have to pay this Vacant Home Tax (VHT) if you meet one of the following criteria:
1. You use the property as your essential house – hold in idea that you can solely have one predominant residence. It is a property the place you dwell and behavior your day by day affairs, acquire mail and pay bills.
2. A accredited occupant is occupying the property as his/her foremost house – this authorized occupant can be a household member and a pal of registered owner
3. Property is occupied by way of tenants who has a written tenancy agreement for a time period of at least 30 days and the property ought to be occupied with the aid of one or extra tenants for extra than 6 months at some stage in the year. If you are the use of your property for non permanent condo much less than 30 days, these do now not count.
4. Vacant with an eligible exemption listed below:
Eligible Exemptions – however you nonetheless have submitting obligation!
1. Death of a registered owner
If the registered proprietor handed away at some stage in the preceding year, and the property used to be vacant for six months as a result, the property would nevertheless be exempted from the vacant domestic tax cited above.
However, the property would then have to supply a reproduction of the loss of life certificates to the City of Toronto as a result.
• Repairs or renovations
If your property is vacant as a end result of present process repairs or renovations, you would possibly meet this eligible exemption if all of the prerequisites beneath are met:
• The property can’t be occupied for everyday use
• There’re fundamental lets in issued for repairs or renovations
• City’s Chief Building Official concurs that the work finished are being actively carried out barring useless delay
If you are making an attempt to get exempted from repairs or renovations, you should supply a description of your renovation and a replica of the constructing allows issued to substantiate your claim.
• Principal resident is in care
If the main resident of your property is residing in a long-term care for up to 6 months in the course of the year, you can get exempted from this Toronto VHT.
You’ll have to supply a signed letter from the fitness care facility on their letterhead as proof.
• Transfer of prison ownership
If you bought your property one hundred percent possession from an unrelated man or woman or organization and assuming that you left your property vacant for over 6 months, you can qualify for VHT exemption. A reproduction of land switch deed is required as proof.
• Occupancy for full-time employment
If you are required to stay in a domestic in Toronto for employment reason for a complete of at least 6 months and that domestic is NOT your important house and your main dwelling is positioned outdoor of GTA, you can nevertheless get exempted from VHT.
You’re required to supply proof of residency backyard of GTA and a signed letter from your company on organisation letterhead or your employment contract.
• Court order
If you have a courtroom order stopping you from occupying the property for greater than 6 months of the year, virtually supply a reproduction of the court order and you’ll get exempted from paying this VHT.
Remember, even if you qualify for one of the exemptions listed above, you would STILL want to publish your announcement on an annual basis. You’re simply now not required to pay for HST.
What if you simply pass over the cut-off date for submitting your declaration?
You can usually post a late announcement with a great of $250 to $10,000.
If you don’t put up any statement at all, your property can be deemed vacant. When it is deemed vacant, your property will be challenge to the tax and you will be issued a Vacancy Tax Notice at 1% of the Current Value Assessment!
Hopefully, none of us is caught in this Toronto Vacant Home Tax regime.