Toronto Property Assessment and Property Tax Explained

Two organisations, two jobs

The Municipal Property Assessment Corporation is responsible for assessing and classifying all properties in Ontario. Every four years it conducts a province-wide Assessment Update and issues a Property Assessment Notice to every property owner. The notice carries a Current Value Assessment, which is what the property could reasonably have been expected to sell for on a fixed valuation date, plus the property classification and four years of phased-in values.

The City of Toronto uses that assessment and classification to calculate tax, and supplies MPAC with the official assessment roll each year. Assessment rolls for the current and prior year can be viewed by the public through the City Clerk’s Office and registry services counters by appointment.

Because of a provincial decision to postpone the 2020 Assessment Update, Toronto’s assessment base for the 2026 tax year continues to be the fully phased-in January 1, 2016 value unless the property itself changed. That same valuation base has been used to calculate Toronto property taxes since 2017.

How the tax is actually calculated

Property tax is a levy on assessed value, and it has two components. The municipal portion is set by the City to fund local services. The education portion is set by the Government of Ontario through the Ministry of Finance and supports elementary and secondary education.

In practice, the calculation is the phased-in assessment value for the year, multiplied by the Council-approved City tax rate, plus the City Building Fund levy, plus the education tax rate. Rates themselves differ by property class: residential, multi-residential, new multi-residential, commercial, industrial, pipelines, farmland and managed forests all carry their own rates.

Which class you fall into is not always obvious. New multi-residential properties are taxed at their own rate for a fixed period before moving to the multi-residential rate, and vacant residential and built-on residential land is taxed at the residential rate, while high-density residential such as condominiums is taxed at the multi-residential rate.

Why a rising assessment is not the same as a rising bill

Assessment increases are phased in over four years, while decreases are implemented immediately. That asymmetry explains a lot of the confusion homeowners experience in an assessment year: the assessed figure on the notice is not necessarily the figure used to calculate the year’s tax.

The second reason is that your bill depends on how your assessment moved relative to everyone else. If the value of your property rose by more than the City average over the assessment cycle, you will see an assessment-related tax increase, because your share of the total tax burden has grown. If it rose by less than average, the same rate can produce a smaller share. The City includes a schedule on the final tax bill showing the financial impact of the update on your property.

Relief programmes for seniors, people with disabilities and lower incomes

Toronto runs a set of property tax, water and solid waste relief programmes rather than a single discount. The main ones are the Property Tax Increase Cancellation Program and the Property Tax Increase Deferral Program, which act on the year-over-year increase rather than the whole bill, plus water and solid waste rebates that reduce the utility side.

Eligibility turns on three things: combined household income of all owners living at the property, the assessed value of the property, and either receipt of disability benefits or meeting an age test. The age test is met by people over 65, by people between 60 and 64 in receipt of the Guaranteed Income Supplement, and — for the deferral and rebate programmes — by people over 50 receiving a registered pension or annuity. The specific income and assessment thresholds are set by Council and indexed over time, so check the current figures on the programme page.

Applications must be made annually with supporting documentation, and reapplying is required even if you received relief the previous year. Supporting documents include a Canada Revenue Agency Notice of Assessment or Reassessment, proof of age for first-time senior applicants, and proof of disability benefit income from sources such as the Ontario Disability Support Program, CPP, WSIB or a private disability plan. A separate Co-Operative Housing Grant Program covers low-income seniors and people with disabilities living in non-profit housing co-operatives who do not hold an individual tax account.

Challenging your assessment

If you disagree with the assessed value or classification on your Property Assessment Notice, the first step is a Request for Reconsideration filed with MPAC. It is free, and MPAC reviews the assessment in detail. For residential, farm, managed forest and conservation land properties, filing a Request for Reconsideration is a prerequisite: you cannot go to the Assessment Review Board until you have been through it. Owners of other property classes may choose either route.

The deadline for a Request for Reconsideration is printed on your Property Assessment Notice, which is why keeping the notice matters. If the outcome goes against you, there is a fixed statutory window from the date MPAC notifies you of the result in which to appeal to the Assessment Review Board, an independent tribunal of the Ontario Ministry of the Attorney General. MPAC states that reviews are usually completed within a set period, with an extension available if more time is needed.

A Request for Reconsideration is only as strong as the evidence attached to it. Useful material includes photographs showing differences between MPAC’s records and the property as it stands, sale information for your property or comparable properties, assessed values of comparable properties from MPAC’s AboutMyProperty tool, recent appraisals, zoning information, and estimates for significant repairs such as foundation, water damage or roof problems.

Paying, checking and managing your account

The City issues interim and final bills each year with instalment due dates published separately, and the Property Tax Lookup lets you view account details, enrol in pre-authorized payments and eBilling, and change your mailing address without waiting for a bill.

Not everything on a tax account is property tax. Special charges are added to the instalment schedule, including Business Improvement Area levies, local improvement charges, areaway charges and repayments under the Home Energy Loan Program. Unpaid utility amounts and charges from other City divisions, such as Municipal Licensing and Standards inspection charges, can also be transferred to the tax roll, at which point they are subject to the arrears collection process.