Wave Goodbye to Vacant Homes - Tax Now In Effect
Toronto has introduced a Vacant Home Tax (VHT) as a means to address the city's housing supply shortage. Starting this month, residential properties that are left unoccupied for more than six months of the calendar year will be subject to taxation at a rate of 1 per cent of the current value assessment (CVA) of the home, unless they are eligible for one of several exemptions.
Property owners must submit a declaration form by February 2, 2023 in order for their residences to be exempt from this tax. According to the city, this tax could increase Toronto's housing supply by incentivising owners to offer up their properties for rent or sale.
Under this measure, residential units are considered vacant if they do not serve as a family home or are unoccupied by tenants for at least six months during the previous calendar year, or conform to any other criteria set out by Toronto City Hall's Bylaw.
Exemptions can include principal residence, death in family, repairs, caretaker/medical circumstances and court orders as well as other specified scenarios. The introduction of the VHT is aimed at improving Toronto's housing supply and reducing vacancy rates overall.
Property owners should be aware of how the VHT affects them and must ensure they act according to its requirements in order to avoid potential taxation.
