Property Tax in Toronto and the GTA
The property tax collected by Canadian provinces can be based on the current use and value of the property. As you probably know, the major source of revenue for most municipalities, paying for local services like parks or schools (excluding colleges and universities) is the property tax. The local property tax should be included in the expense calculations of every property owner. For your convenience, we've prepared a GTA property tax calculator, which will help you to determine how much tax there is on your property.
Frequently Asked Questions about the GTA Property Tax:
How is the property tax calculated?
If you want to calculate your property tax, multiply your property's assessed value by the tax rate, which consists of municipal, county and education rates. Our property tax calculator covers all municipalities in the GTA.
What are the different rates for various properties?
There are four major property classes (residential, multi-residential, industrial, commercial), each having its own rate.
What is the assessed value?
The Municipal Property Assessment Corporation (MPAC) estimates the market value of each property in Ontario on a regular basis. This Current Value Assessment occurred in 2008 for the tax years from 2009 to 2012. The changes are phased in during the four years.
Do I have to ask for an assessment?
No, you don't. It is done automatically by MPAC. The corporation will mail notices of assessment to all owners.
What does 'phased in' mean?
The new assessed value will be implemented gradually. If your property was assessed to be $300,000 in 2005 and then $360,000 in 2008, the new assessed values for the following years will be $315,000 in 2009, $330,000 in 2010, $345,000 in 2011 and $360,000 in 2012.
What if I disagree with the assessed value?
There is a possibility to appeal the assessment. However, its deadline for the latest round of assessment was March 31, 2009.
What is the Property Assessment Change Notice?
In case there was any change with the property (i.e. a change in property classification; an addition, renovation or new construction to a property), MPAC will issue a Property Assessment Change Notice. If it is a new construction, it may apply to the current year and, if applicable, for any part or all of the previous two years. If you become the owner of a newly constructed property, the first regular bill you receive from the City could only be for a portion of the assessment value for your unit, so remember this fact.
Will my property tax increase as my property value increases?
No, if the value of your property increases at an average rate. Every reassessment is revenue neutral—the tax rate will be lowered by the municipal government when property values should increase all around a municipality. However, if your property value growth is higher than the local average value growth, your property tax may rise. Multi-residential, commercial and industrial properties are protected by capping—no matter how much a property's value increases, its property tax can rise only to a certain extent. This is mainly because the reduction in tax for properties with declining value also have certain limitations.
Who will prepare my bill, and how should I pay it?
Your municipality will issue the standardized property tax bill. You have a large number of payment options (including the bank or other financial institutions, mail, pre-authorized tax payment program, enquiry/cashier counters, mortgage company, and payment drop boxes).
What if I can't afford to pay the tax bill?
Low-income seniors and low-income persons with disability have the opportunity to apply for a deferral of property tax increases or for a complete cancellation of property tax increases.
How is my property tax used?
Services like the police, the fire department, local public transport, and libraries, as well as for municipal debt are paid from the tax. Just to give you an idea, in Toronto, around 25% of collected property tax goes to police service, 14% to TTC, 11% for paying municipal debt, and 10% to fire department.
Is there any other tax I need to consider when purchasing property?
Yes. You are subject to the Ontario Land Transfer Tax. In case that the property is located within the City of Toronto, the Toronto Land Transfer Tax also applies. To calculate this amount, use this convenient Toronto Land Transfer Tax Calculator and FAQ.
*On the Tax Bill, the "N" indicates rural area with rural garbage services, while the "G" indicates rural area with urban garbage services.