Toronto’s Vacant Home Tax: Investor Compliance Checklist

If you own a condo or a small portfolio in Toronto, the Vacant Home Tax can feel like a moving target. You want to stay compliant, avoid penalties, and keep your documentation airtight without losing weeks to admin work. This guide gives you a practical investor checklist that you can follow each year to file on time and stay audit-ready.

You will learn who must declare, which exemptions matter for investors, the key dates to watch, and the documents to keep. You will also get portfolio-specific tips for condo owners, pied-à-terre users, and short-term rental operators. Let’s dive in.

What the Vacant Home Tax covers

Toronto’s Vacant Home Tax applies to residential properties the City classifies as vacant. The City administers the program under municipal by-law and official program materials. The rules and deadlines can change, so always confirm current details on the City’s VHT pages before you file.

Every legal owner must submit an annual declaration for each residential property in Toronto. This includes individual owners, corporations, trustees, partnerships, and co-owners. Declarations are retrospective and report the prior calendar year’s occupancy status.

The tax is charged as a percentage of the property’s assessed value. The rate is set by by-law, and you should confirm the current rate and any updates on the City’s website before submitting your declaration.

Investor-focused exemptions

Long-term rental occupancy

If a unit is occupied by tenants for a minimum threshold of days during the year, it is typically treated as occupied. Evidence to keep includes executed leases, rent rolls, tenant attestations, rent receipts, bank deposits, and property manager statements.

Principal residence and family occupancy

A property used as your principal residence is commonly exempt. For joint ownership or multiple residences, follow the City’s criteria for principal residence and keep supporting documents such as a driver’s licence, utility bills, and tax filings. Occupancy by immediate family may also qualify, subject to the City’s definitions and evidence requirements.

Short-term rentals vs long-term use

Short-term rental bookings do not automatically count as long-term occupancy. If total occupied days do not meet the long-term threshold, the City may treat the property as vacant for tax purposes. Keep platform booking exports, payout statements, and cleaning logs to support your records.

Construction, renovation, and uninhabitable periods

If major construction or renovation made the unit uninhabitable, you may qualify for an exemption. Keep permits, contractor invoices, inspection reports, and occupancy certificates.

Temporary absence and estates

Exemptions may apply for extended absences related to work, education, or medical needs. Keep employer letters, travel records, or medical documentation. Estates may qualify based on title and possession conditions in the by-law.

Notes for corporate and trust owners

The registered owner on title must declare. Corporate owners should expect closer audit scrutiny. A corporate principal residence claim is unlikely to apply without clear supporting use evidence.

Annual timeline you can follow

January to February: prepare and file

• January: The City typically opens the declaration portal for the prior year. Start gathering evidence and reconciling records.
• January to February: Assemble unit-level documentation and any property manager attestations.
• End of February: The filing deadline is commonly the last business day of February. Confirm the exact date each year on the City’s website.

March to June: assessments and checks

• The City may issue assessments or invoices and can begin audits or information requests.
• Respond promptly to any City communications and retain copies of all submissions.

Year-round: keep records organized

• Maintain your records and evidence in a secure repository.
• A practical retention period is at least 6 to 7 years or until any municipal audit or appeal window closes.

Step-by-step filing workflow

1. Create a unit register with unit ID or roll number, address, and legal owner details.
2. Build a daily occupancy calendar for the prior year per unit, including owner-occupied, tenant-occupied, short-term bookings, or vacant days.
3. Collect evidence per unit, such as leases, rent receipts, bank deposits, and booking exports.
4. Reconcile rent and platform payouts to lease or booking dates.
5. Have the legal owner or authorized officer complete and submit the online declaration.
6. Save the filing confirmation and archive a “declaration evidence pack” for each unit.

Portfolio checklists that save time

Condo portfolios

• Maintain a consolidated rent roll plus unit-level leases and move-in or move-out dates.
• Obtain annual tenant attestations for long-term tenancies.
• Have property managers provide a written attestation of occupancy and accuracy if they file for you.
• Keep central spreadsheets mapping each unit to its evidence and filing status.

Pied-à-terre owners

• Keep a simple stay calendar with dates you used the unit.
• Save travel records that align with your stay dates.
• Retain utility and insurance documents that show usage patterns.
• If you also do short-term rentals, export platform data and reconcile with your stay calendar.

Short-term rental operators

• Export booking calendars, payout statements, and cleaning invoices.
• Calculate total occupied days for the year and compare to the long-term threshold.
• Reconcile platform payouts to your bank deposits.
• If you do not meet the threshold, prepare for a vacancy designation unless another exemption applies.

Audit-ready document checklist

Keep originals and digital copies, with timestamps where possible. Store for at least 6 to 7 years.

• Leases and rental agreements, with tenant contact details and move-in or move-out dates.
• Rent rolls, rent receipts, bank statements, cancelled cheques, and online payment confirmations.
• Tenant attestations confirming occupancy dates.
• Short-term rental platform exports, payouts, calendar files, and cleaning logs.
• Property manager or concierge logs, and building access data when available.
• Utility bills, internet statements, and service invoices that support claimed occupancy.
• Home insurance declarations and household services contracts.
• Travel records to support owner-occupied or pied-à-terre use.
• Building permits, contractor invoices, inspections, and occupancy certificates.
• Condo corporation notices, resolutions, and unit access records.
• Listing agreements and showing logs if the unit was for sale.
• Corporate governance documents for corporate owners.
• Title records, ownership changes, and trust documentation as needed.

Avoid common audit triggers

• Long gaps between tenants or bookings with no supporting evidence.
• Declaring “occupied” while short stays do not reach the long-term threshold.
• Corporate or trust owners claiming personal residence use without strong evidence.
• Late, missing, or inconsistent filings year over year.
• Rent rolls that conflict with utility usage or other unit-level records.

Penalties, disputes, and appeals

If you do not file, the City can designate the property as vacant and assess tax, penalties, and interest. False statements may carry fines or enforcement consequences. After the City issues an assessment, you have the right to request a review or appeal within set timelines.

Support any review or appeal with the same documentation you would use in an audit. For larger portfolios or complex structures, consider advice from a municipal tax lawyer or accountant with Toronto VHT experience.

Quick action checklist

• Confirm the current filing deadline and tax rate on the City’s VHT pages.
• For each unit, create a register and populate a daily occupancy calendar for the prior year.
• Collect leases, rent receipts, STR exports, utility bills, manager attestations, and any renovation or travel evidence.
• Reconcile deposits to lease or booking periods.
• File online by the published deadline and save confirmation.
• Archive a complete declaration evidence pack per unit for at least 6 to 7 years.

Need leasing support or a filing-ready rent roll?

If you are filling vacancies before the next declaration, our team can help you market and lease units quickly, capture clean tenant documentation, and keep your filing timeline on track. Our leasing services for investors and landlords are built to reduce friction and improve your paper trail.

Ready to strengthen your compliance process and keep units cash-flowing? Reach out to the McDougall Team to get started.

FAQs

What is Toronto’s Vacant Home Tax and who must declare?

• Every legal owner of a residential property in Toronto must file an annual declaration that reports the prior year’s occupancy, with tax applied to properties the City designates as vacant.

Which exemptions commonly apply to Toronto investors?

• Long-term rental occupancy, principal residence or family occupancy, uninhabitable periods due to construction, temporary absences, and qualifying estate situations can apply.

Do short-term rentals count as occupied for VHT?

• Short-term bookings only help if total occupied days meet the City’s long-term threshold; otherwise the property may be treated as vacant.

What documents should I keep for a VHT audit?

• Keep leases, rent rolls, rent receipts, bank deposits, STR exports, utility bills, permits, and any manager or tenant attestations for at least 6 to 7 years.

When is the VHT declaration due each year in Toronto?

• The deadline is commonly the last business day of February for the prior year’s occupancy, but you should confirm the exact date on the City’s website each year.

How do corporate owners handle VHT declarations?

• The registered owner on title must file, corporate claims of personal residence use face closer scrutiny, and unit-level documentation is essential for audits.