Landlord guide · Property tax
Vacant home tax in Toronto, Hamilton and Ottawa: what landlords need to know
Short answer
Toronto charges a Vacant Home Tax of 3% of a home's assessed value when it sits empty six months or more in a year; Hamilton and Ottawa charge 1%. Owners must declare every year, even for a rented home. In Toronto, a tenancy counts if the lease ran 30 days or more and tenants lived there six months in all.
How Toronto's Vacant Home Tax works
Toronto charges the tax on a residential property that was vacant for six months or more during the year. Since the 2024 taxation year, the rate has been 3% of the property's Current Value Assessment, the value MPAC puts on your property tax bill. On a home assessed at $600,000, that's $18,000, as well as the rent you didn't collect.
A home is also deemed vacant, and taxed, if the owner doesn't declare its occupancy status by the deadline, even if it was rented all year. The tax is a lien on the property, so a buyer inherits any unpaid amount, and overdue amounts add interest of 1.25% a month. A false declaration, or not giving the City documents it asks for, can bring a fine of up to $10,000 plus the tax.
For landlords, the simplest protection is a short gap between tenancies. Pricing the unit right and getting it in front of applicants quickly is the core of our tenant placement service.
When a rented home counts as occupied in Toronto
A home rented to a tenant counts as occupied when two things are true:
- A written agreement of at least 30 days. The tenant, or a business tenant, needs a written lease or rental agreement with a term of 30 days or more. Stays shorter than that don't count.
- Six months in total. Tenants' occupancy must add up to at least six months in the year. It doesn't have to be one tenant or one stretch.
Family members or friends living there count only if the home is their principal residence for at least six months. A home that's your own principal residence isn't taxed, but you still have to declare it.
Keep a copy of every lease, with the move-in and move-out dates, for each year. If the City audits a declaration, it asks for documents, and you have 60 days from its letter to send them.
Declaring every year
Every owner of a residential property in Toronto must declare its occupancy status each year by April 30, for the year before. That includes owners who live in the home, owners who rented it out all year and owners who qualify for an exemption.
A few properties don't need a declaration: those assessed entirely as multi-residential, commercial or industrial, vacant land with no building, parking spaces and condo lockers. A newly built home needs one only once it's on MPAC's assessment roll.
Missing the deadline is the expensive mistake: the home is treated as vacant, and the tax goes on the bill.
Exemptions in Toronto
A home that sat empty can still be exempt, with supporting documents, in these situations:
- the death of a registered owner (for up to three years in a row);
- a principal resident in care for at least six months (up to two years in a row);
- major repairs or renovations that kept it empty;
- a sale, with the transfer of ownership closing in the year declared;
- an owner who lives outside the GTA and uses the home to work full time in Toronto;
- a court order that prohibits occupancy;
- new homes unsold by their builder (up to two years in a row);
- a secondary residence used for medical treatment, when the principal residence is outside the GTA.
Waiting for the right tenant isn't on the list. A unit that sits on the market for half the year is taxed like any other empty home.
Bills, payments and disputes in Toronto
The tax isn't part of a pre-authorized property tax payment plan; it's billed and paid separately. For the 2025 occupancy year, the City sent notices in June 2026, with payments due in three instalments on September 15, October 15 and November 16, 2026.
To dispute an original bill, you file a Notice of Complaint: for 2025 bills, by December 31, 2026. A bill issued after an audit must be disputed within 90 days of its date, and a decision on a complaint can be appealed within 90 days. The appeal decision is final.
Hamilton's Vacant Unit Tax
Hamilton charges an additional 1% tax on a residential property left vacant for more than 183 days in the previous year. Owners must declare every year, including those who live in the home. For the 2025 occupancy year, declarations were due April 15, 2026, with late declarations accepted until May 15 for a $250 fee. Undeclared properties are treated as vacant and charged.
Hamilton's exemptions include an owner's death, major renovations with a building permit, a sale in the year, a principal resident in hospital or care, a court order and a property that's uninhabitable.
The tax's future is decided year by year: in October 2025, Council voted 8 to 7 to keep it for the 2025 occupancy year. Check the City's page before you count on it either way for 2026.
Ottawa's Vacant Unit Tax
Ottawa's tax is 1% of the assessed value for the first year a property is vacant, rising by one percentage point for each further year in a row, to a maximum of 5%. It drops back to 1% after a year of occupancy.
A unit counts as vacant if it was unoccupied for more than 184 days in total in the previous year. A rental counts as occupied if tenants lived there at least 184 days, in stretches of at least 30 days each. Declarations open in January and are due by the interim property tax due date; late declarations are accepted until April 30, with a $250 fee.
Keeping a rental out of the vacancy tax
- Count the days. In all three cities, the question is how long the home sat empty. A two-month gap between tenants is far from the line; a unit that sits unrented from spring to fall isn't.
- Price for today's market. Asking rents across Ontario were down 4.8% from a year earlier in September 2026, and a unit priced off last year's listings can sit. Our average rent guide shows where your city stands.
- Use written leases of 30 days or more. Short stays don't count as occupancy in Toronto or Ottawa, and Toronto only allows them in your own principal residence anyway (see our Toronto short-term rental guide).
- Keep the paperwork. Leases, move-in and move-out dates, and permits for any renovation that kept the unit empty.
- Declare on time, every year. In Toronto and Hamilton, a missed declaration is treated as a vacancy even when the home was rented, and Ottawa adds a late fee.
Sources
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