Posted by Maryann Quenet on Friday, July 25th, 2025 1:55pm.
Imagine waking up one morning to find that your elegant Toronto abode—your sanctuary and investment—is suddenly costing you tens of thousands of dollars, not because of a surprise renovation or wild market swing, but simply because it sat empty for more than six months. As of 2024, the Vacant Home Tax rate has leapt from 1 per cent to 3 per cent of your home’s assessed value for properties deemed vacant, and with last year’s botched rollout prompting a “complete redesign” of the program, the stakes have never been higher. If you miss the April 30 deadline to declare your occupancy status, the city treats your home as taxable—no questions asked—so understanding how to navigate exemptions, file on time, and safeguard your hard‑earned equity is essential to keeping your pocketbook intact.
The Vacant Home Tax applies to any residential property in the City of Toronto that remains unoccupied for more than six months (183 days) within a calendar year.
Declared or deemed vacant units are subject to a tax equal to 1% of the property’s current assessed value as determined by MPAC.
All residential property owners must submit an annual declaration by April 30, regardless of occupancy status. Failure to file a declaration triggers an automatic 1% tax for that year.
Properties used as the owner’s principal residence are exempt, even if unoccupied for up to six months.
Units occupied by full-time tenants for more than 183 days are exempt, provided lease agreements or rent receipts are submitted.
Owners may qualify for exemptions if the property was vacant due to:
Death of the registered owner (up to three consecutive years)
Major repairs or renovations lasting more than six months
Occupancy for full-time employment outside the GTA
Court orders prohibiting occupancy
To claim an exemption, homeowners must provide supporting documentation—such as death certificates, renovation permits, or employment letters—via the City’s online portal.
Ensure the property is officially designated as your principal residence in your declaration, particularly if you have multiple properties. This designation exempts the home from the tax if you genuinely reside there and receive mail, pay bills, and store personal belongings there.
Leasing the property to tenants for at least six months establishes occupancy. Keep copies of lease agreements, rent receipts, and utility bills to submit as proof.
Plan renovations that span over six months—such as structural upgrades or complete interior overhauls—to qualify for the renovation exemption. Upload building permits and contractor invoices to the City’s system.
Transferring legal ownership via sale or co-ownership restructuring removes the property from your name before the declaration deadline. Consult your lawyer to complete the transaction early in the year.
Short-term rentals alone may not qualify as occupancy under VHT rules, unless they cumulatively exceed 183 days. Verify occupancy records through platforms like Airbnb and retain booking statements.
Gather Documentation: Collect lease agreements, renovation permits, or other proof of occupancy/exemption.
Complete the Online Declaration: Log in to the City of Toronto’s Vacant Home Tax portal and declare each property’s status by April 30.
Submit Exemption Requests: Attach required documents for any exemptions claimed.
Pay Any Tax Due: If a property is taxable, installment payments are scheduled in September, October, and November of the taxation year.
Late or inaccurate filings may prompt audits, reassessments, and penalties up to 1.5 times the tax amount plus interest.
Avoiding Toronto’s Vacant Home Tax comes down to one thing: planning. By declaring your home’s status before the April 30 deadline, and ensuring it qualifies as your principal residence, is leased for at least 183 days, or is under major renovations, you sidestep the 1 per cent tax on your home’s assessed value. Miss the deadline or file inaccurately and you risk a deemed‑vacant assessment, interest charges and even audits that can follow you—and future owners—for years.