Toronto’s Vacant Home Tax is 3% of a property’s assessed value, not 1% as it was when the tax began, and the City’s page says the 3% rate applies from the 2024 tax year. The tax is not new in 2026, and the declaration deadline is April 30, not the end of February. A home assessed at $1,000,000 that sits vacant costs $30,000 for the year.
How the rate changed over time
The tax started at 1% of the property’s Current Value Assessment, the figure the Municipal Property Assessment Corporation puts on your property tax bill. According to the City’s Vacant Home Tax page, the rate then increased to 3%, beginning with the 2024 taxation year.
That timing matters because an older version of this story claimed the rate tripled starting in 2026. It did not. If you are reading about the 2025 tax year, the 3% rate already applied. The dates on the City’s page are the ones to trust.
The tax works on assessed value, not market value. Your assessment might be lower than what a buyer would pay today, which sometimes helps and never hurts. Use the value on your bill.
Who has to declare
Every owner of a residential property in Toronto declares occupancy each year. This applies even when you live in the home, and even when the answer is obviously that it is occupied. The declaration is what tells the City the property is not vacant.
Future declarations are due April 30. The City’s page says the window for declaring 2025 occupancy has passed and the portal is closed, so a late declaration for that year is no longer available online.
If you do not declare, the City assumes the property is vacant. It then sends a Notice of Assessment, which is a bill for the tax. That is the main risk of ignoring the mail, since a home that was fully occupied can still be billed if nobody said so.
What counts as occupied
A property is occupied if it is the owner’s principal residence. It is also occupied if someone other than the owner lives in it as their principal residence for at least six months of the year. That someone can be a tenant or a family member.
The City notes that owners can be away for long periods for travel, work or medical reasons and still claim occupancy, as long as the property is their principal residence. A snowbird who lives in the home for most of the year and winters elsewhere is not treated as vacant by that fact alone.
What does not count is a home that is furnished and sitting empty, or one used only by occasional guests. Whether a short-term rental counts as occupied is a question for the City’s rules, and we could not confirm a simple answer from the pages we opened. If you rent a home short-term, read the City’s guidance before you assume it qualifies.
What the tax costs
The formula is short. Multiply the assessed value by 3%.
A condo assessed at $1,000,000 costs $30,000 for a vacant year. For a house assessed at $800,000 the tax is $24,000. At $500,000 it is $15,000, and at $1,500,000 it reaches $45,000.
Now stretch it over time. If the $1,000,000 condo sits empty for two years, the tax is $60,000, and for three years it is $90,000. The figure adds up quickly because each year is its own charge.
You can try your own assessment in the Vacant Home Tax calculator, which lets you compare several years and the exempt option.
Six months in practice
The six-month test for tenants is where owners often slip. Think about a home with a tenant who moves in on March 1 and leaves on August 31. That is six months, so the property meets the threshold for that year if the tenant lived there as a principal residence throughout.
Change the dates. A tenant moves in on May 1 and leaves on September 30. That is five months, one short of the six the City describes. If the home was empty the rest of the year and no exemption applies, it could be treated as vacant, and the tax on an $800,000 assessment would be $24,000.
Gaps between tenants deserve attention for that reason. A month of turnover here and there is fine. But a home that has one tenant for four months and stands empty for eight is exposed. Keep leases with exact dates, since the dates are the proof.
The City’s page does not describe pro-rating the tax by months. As we read it, the test is about the year as a whole, so we could not confirm any partial charge. If your home was occupied for part of the year only, ask the City how your case would be treated before you rely on a reduction.
Penalties and interest
The City page says that giving false or misleading information, or failing to provide information the City asks for, can lead to a fine of up to $10,000 in addition to the tax itself. The fine is a maximum, not a set fee, and it sits on top of the tax rather than replacing it.
Interest also applies to unpaid amounts. The City states 1.25% on the first day of default and on the first day of each month after that. On a $30,000 bill left unpaid, one month of interest is $375 ($30,000 times 0.0125).
Put those together with a wrongly assumed vacancy, and a simple missed declaration can become a large bill. That is a reason to declare on time, even if you are sure your home is occupied.
Where the tax sits next to your regular bill
The Vacant Home Tax is charged in addition to your regular property tax. The two are not linked. Your yearly property tax bill covers City services and school funding, and it is not lowered or raised by a vacancy finding.
To see how large the vacancy tax is in comparison, use the City’s average assessed home of $692,140 from the 2026 budget material. The Vacant Home Tax on that assessment would be $20,764.20 ($692,140 times 0.03). The 2026 residential property tax increase on the same home is about $91.53. So the vacancy charge on one year is more than 226 times the yearly increase ($20,764.20 divided by $91.53).
That gap explains why the City’s declaration process matters to owners. A small paperwork mistake costs far more than a change in the regular rate.
Exemptions
The City lists a number of situations where a vacant home is exempt. They include the death of an owner, an owner living in a care facility, major repairs or renovations, a transfer of ownership during the year, a court order that prevents occupancy, and a secondary residence held for medical reasons. The City page also lists full-time employment requirements and new construction inventory.
Each exemption has conditions, and the City expects you to claim it through the declaration. An exemption does not apply just because your situation fits it. You have to say so, and be ready to back it up.
A common case is the renovation. If a home is empty because of major work, the exemption may apply, but the City will want to see that the work was real and substantial. Permits, contracts and invoices are the kind of records that help.
If you get a Notice of Assessment
A Notice of Assessment means the City considers the property vacant. If that is wrong, you can file a complaint through the City’s portal. For the 2025 tax year the complaint deadline is December 31, 2026. The deadlines for the 2022, 2023 and 2024 tax years have passed.
The complaint asks the City to review the decision. If it is denied, you can appeal within 90 days of the complaint decision, and the appeal is heard in writing. The City’s page also notes that complaints tied to audit notices have a 90-day window.
Keep the sequence in mind. Notice, complaint, decision, appeal. Missing a step can end the process, so calendar the dates the day the notice arrives. Our Vacant Home Tax dispute guide walks through the steps in more detail.
Steps for the yearly declaration
The process is quick when you have your details ready.
- Gather the details on your property tax bill or on any City notice, so the portal can match your property.
- Log in to the City’s Vacant Home Tax portal before April 30.
- Choose the occupancy status that fits: owner-occupied, occupied by someone else, or an exemption.
- Review every entry, then submit.
- Save the confirmation and store your supporting records.
A confirmation is your proof that you declared. Without it, you may have trouble showing the City that you did. Print it or save it as a file, and store it with your other property papers for at least three years, since that is how long the City may audit a declaration.
A three-year example
Numbers over several years show how the choices compare. Take a condo assessed at $900,000. The owner lives abroad and is deciding what to do for three years.
Option one is to leave it empty all three years. The tax is $27,000 a year ($900,000 times 3%), so $81,000 over three years, plus regular property tax and condo fees on top.
Option two is to rent it from the start of year one to a tenant who lives there as a principal residence. There is no vacancy tax in any year, and the owner earns rent. At $2,400 a month, that is $28,800 a year, or $86,400 over three years, before expenses and income tax on the rent.
Option three is to leave it empty in year one, then rent it. The owner pays $27,000 in year one and nothing after that. Year one’s lost rent is $28,800, so the real cost of waiting a year is close to $55,800 counting both the tax and the missed rent.
Treat these figures as illustrations only. Rents, assessments and expenses differ by building. But the pattern holds: at 3%, a vacant year costs roughly what a year of rent would bring in, and often more. Test your own case in the Vacant Home Tax calculator and the rental property calculator before you decide. See also the Land Transfer Tax calculator, and the full set of real estate calculators.
Sources
Common questions
What is the Toronto Vacant Home Tax rate?
When is the declaration deadline?
What is the penalty for a false declaration?
How long can I dispute a 2025 bill?
Last reviewed: . Figures come from the official sources listed above. How we check the numbers and our editorial policy.