Own a Toronto property that sometimes sits empty? A missed declaration or a few vacant months can trigger a tax bill equal to a percentage of your home’s assessed value. You want clarity on what counts as vacant, when to file, and which exemptions protect you. In this guide, you’ll get the key deadlines, the current rate, common exemptions, and simple steps to avoid costly mistakes. Let’s dive in.
What is the Vacant Home Tax?
Toronto’s Vacant Home Tax (VHT) applies to residential properties that are unoccupied for more than six months in a calendar year, unless an exemption applies. The tax is calculated on your property’s Current Value Assessment (CVA). The program aims to discourage long-term vacancies and support housing initiatives across the city. You can review the City’s overview and recent program changes in the City’s summary of the 2024 Vacant Home Tax program.
Who must declare each year
Most residential property owners must submit an annual occupancy declaration, even if the home is your principal residence. Some property types are excluded, such as vacant land without a structure or properties fully assessed as multi-residential, commercial, or industrial. If you do not declare, your property can be “deemed vacant,” which may trigger the tax. See the City’s declaration and program details for eligibility and filing steps.
Key deadlines and timing
- Declaration windows: For the 2024 reference year, the City ran an extended window from November 1, 2024 to April 30, 2025. The City notes the 2025 declaration period will open November 3, 2025. Always verify the live portal dates on the City site.
- Notices and payment: If no declaration is filed by the deadline, the City issues a Notice of Assessment (the City indicated May for 2024). For the 2024 taxation year, VHT payments are due in three equal instalments on September 15, October 15, and November 17, 2025. Check the City’s VHT page for current-year dates.
- Disputes and appeals: You can file a Notice of Complaint and appeal through the City portal. The City indicated a deadline of December 31, 2025 to dispute 2022–2024 assessments. Time limits apply if you are audited.
How the tax is calculated
- Rate history: The VHT was 1% of CVA for 2022 and 2023. It increased to 3% of CVA for 2024 and future years, as approved by Council. The tax for a vacancy in a given year uses that same year’s CVA. The City confirms the rate change in its 2024 program update.
- Example: If a property with a CVA of $1,000,000 is vacant for the taxation year, the VHT would be $30,000 at the 3% rate.
What counts as vacant or occupied
A property is considered vacant if it was unoccupied for more than six months in the calendar year. Occupied status generally includes:
- Owner or a permitted occupant using the property as their principal residence for at least six months.
- Tenants occupying the property for residential purposes with 30-day minimum tenancies that total at least six months in the year (keep written tenancy records). The City outlines these rules in its VHT declaration guide.
Exemptions you can claim
You may claim an exemption if you meet City criteria and can provide documentation. Common categories include:
- Principal residence of the owner or a permitted occupant (six months or more).
- Occupied by tenants (qualifying leases total at least six months, with 30-day minimum terms).
- Death of a registered owner (up to three consecutive taxation years, with proof).
- Principal resident is in care for six months or more.
- Major renovations or repairs that make the home uninhabitable, with permits and evidence the work moved forward in a reasonable timeframe.
- Transfer of legal ownership during the year.
- A court or municipal order prohibits occupancy (see Ontario’s municipal VHT framework for context). For audits or complaints, the City may ask for proof such as government ID, tax notices of assessment, leases, vehicle registration and insurance, employment records, insurance certificates, wills, and probate documents. Keep relevant records for at least three years, as listed on the City’s VHT page.
How to declare and handle audits
- File your declaration: Use the City’s online portal with your customer number and 21-digit assessment roll number or address. You will receive a confirmation number or receipt when done. The City explains portal access in its program update.
- If you are audited: Respond within the timeframe noted in the City’s letter (the City references 60 days) and submit requested documents. If assessed as vacant and you disagree, file a Notice of Complaint and follow the appeal steps on the VHT page.
Penalties, fees, and interest
Unpaid VHT is added to your property tax roll and accrues interest at 1.25% on the first day of default and monthly until paid. You can review interest rules in the City’s guidance on late property tax payments. Fines for offences can be significant, including up to $10,000 for false declarations or failure to provide information, according to City materials. The City waived the late-declaration administrative fee for the 2024 declaration period, but fees can change, so always check current notices.
Buyers and sellers: what it means for your deal
If you are buying, ask the seller for proof of recent VHT declarations and any exemption documents. A missed declaration can result in an assessment after closing. If you are selling or holding a vacant home, understand the cost impact at the 3% rate and consider timing your sale, renovation, or lease strategy to avoid a vacancy assessment. For investors, qualifying leases can count toward occupancy, provided you keep solid records.
How VHT differs from the federal UHT
The federal Underused Housing Tax (UHT) is a separate tax, generally focused on non-resident owners and certain entities. Being exempt from the municipal VHT does not make you exempt from the UHT, and vice versa. Review the CRA’s UHT guidance to assess your federal obligations.
Ready to align your sale, purchase, or leasing plan with today’s VHT rules? Get tailored guidance and a data-driven strategy with the McDougall Team.
FAQs
Do Toronto homeowners have to declare if they live in the home?
- Yes. Most residential owners must file an annual declaration, even if the home is your principal residence for six months or more during the year, as outlined on the City’s VHT page.
What is the current Vacant Home Tax rate in Toronto?
- The VHT is 3% of the property’s CVA for 2024 and future years (it was 1% for 2022–2023), per the City’s 2024 program summary.
When are the Toronto VHT deadlines for declarations and payments?
- For the 2024 reference year, declarations ran November 1, 2024 to April 30, 2025; payments for 2024 VHT are due September 15, October 15, and November 17, 2025, per the City’s VHT details.
Which exemptions help avoid the Vacant Home Tax in Toronto?
- Common exemptions include principal residence, tenant occupancy, death of an owner, owner in care, major renovations with permits, transfer of ownership, and orders prohibiting occupancy; see the City’s VHT page for details.
How does the Vacant Home Tax differ from Canada’s Underused Housing Tax?
- The VHT is a municipal tax administered by Toronto, while the UHT is a federal tax with separate rules, forms, and exemptions; review the CRA’s UHT guidance to understand federal requirements.
