Toronto Vacant Home Tax: What Every Property Owner Needs to Know

All residential property owners in Toronto are required to declare the occupancy status of their property every year. Even if your home is occupied or exempt, a declaration is still mandatory.

The Vacant Home Tax (VHT) is enforced by the City of Toronto and is designed to discourage long-term vacancies and increase housing supply.

Here’s how it works — without the noise.

When is a property subject to the Vacant Home Tax in Toronto?

A residential property may be subject to the Vacant Home Tax if:

  • It is not the principal residence of the owner
  • It is unoccupied for more than six months in a calendar year
  • It does not qualify for an exemption

If a declaration is not submitted, the property is automatically deemed vacant.

Which properties are exempt?

A property may be exempt if it meets one of the following conditions:

  • It is the principal residence of the owner
  • It is occupied by an eligible tenant
  • It qualifies under an approved exemption, including:
    • Death of a registered owner
    • Major repairs or renovations preventing occupancy
    • Principal resident in hospital, long-term, or supportive care
    • Legal transfer of ownership
    • Employment-related absence outside the GTA
    • Court order prohibiting occupancy for six months or more

Important:
Exempt does not mean exempt from declaring. Failure to declare still triggers penalties.

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How long can the “Death of a registered owner” exemption be claimed?

  • The property must be vacant due to the owner’s death
  • The exemption may be claimed for up to three consecutive taxation years
  • Supporting documentation (death certificate) is required

How does the “Principal resident in care” exemption work?

  • The resident must be in hospital, long-term, or supportive care
  • The stay must total at least six months in the year
  • The exemption can be claimed for up to two consecutive years

Is the Vacant Home Tax based on market value?

No.

The Vacant Home Tax is calculated using the Current Value Assessment (CVA) — the same assessed value used for property taxes — not market value.

What’s the difference between assessed value and market value?

Assessed Value (CVA):
Determined by MPAC for taxation purposes and typically lower than market value.

Market Value:
What a property could sell for under current market conditions.

How is the Vacant Home Tax calculated?

The Vacant Home Tax is calculated as a percentage of the Current Value Assessment for properties vacant more than six months.

Example:
A property with a CVA of $1,000,000 would result in a Vacant Home Tax of $30,000 at a 3% rate.

(Tip: keep the rate stated once — if the City ever changes it, you update one line.)

What happens if I miss the declaration deadline?

If a declaration is not submitted by the annual deadline:

  • A late declaration fee applies
  • The property is deemed vacant by default
  • Monthly interest accrues on any unpaid Vacant Home Tax balance

This is one of the most common — and costly — mistakes owners make.

What happens if the Vacant Home Tax is not paid?

Unpaid Vacant Home Tax amounts are:

  • Added to the property tax roll
  • Collected the same way as property taxes
  • Subject to ongoing interest and enforcement

Vacant Home Tax vs. Underused Housing Tax: what’s the difference?

Vacant Home Tax (VHT): A municipal tax enforced by the City of Toronto

Underused Housing Tax (UHT): A federal tax administered by the CRA

Some owners are subject to both, and each has separate filing requirements.

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Why was the Vacant Home Tax introduced?

The Vacant Home Tax exists to:

  • Discourage long-term residential vacancies
  • Increase available rental housing
  • Push underused properties back into circulation

In short: housing is meant to be lived in — or paid for.

How do I declare my property’s occupancy status?

Declarations must be submitted annually through the City of Toronto’s Vacant Home Tax system. Owners can declare online, by phone, or by mail.

If you’re unsure about your status, exemptions, or ongoing compliance — this is exactly what professional property management is designed to handle.