Property Tax in Toronto and the GTA
Provinces in Canada may levy property tax based on the current use and value of the property. Property tax is the major source of revenue for most municipalities, which pays for local services like schools (excluding colleges and universities) or parks. Every property owner should include local property tax in his or her expense calculations. 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?
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.
Are rates the same for all kinds of properties?
No. There are four major property classes (residential, multi-residential, industrial, commercial), each with 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, this 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 201,1 and $360,000 in 2012.
What if I disagree with the assessed value?
You can appeal the assessment. However, the appeal deadline for the latest round of assessment was March 31, 2009.
What is the Property Assessment Change Notice?
When some sort of change has occurred to a property (i.e. a change in property classification; an addition, renovation or new construction to a property), MPAC issues 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. Also, be aware that if you become the owner of a newly constructed property, the first regular bill you receive from the City may only be for a portion of the assessment value for your unit.
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—if assessed property values increase all around a municipality, the municipal government will lower the tax rate. 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 possible because the reduction in tax for properties with declining value are also limited.
Who will prepare my bill, and how should I pay it?
The standardized property tax bill will be prepared by your municipality. There is 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 cancellation of property tax increases.
How is my property tax used?
Municipalities use it to pay for services like the police, the fire department, local public transport, and libraries, as well as for municipal debt. For example, 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. Also, if the property is located within the City of Toronto, the Toronto Land Transfer Tax also applies. To determine this tax amount, you can use our convenient Toronto Land Transfer Tax Calculator and FAQ.