REVIEWSHomeowners
When you buy a home, the listing price is not a complete view of what you’ll pay during the transaction. You have fees like closing costs and a Land Transfer Tax to pay, in addition to what this article will talk about which are property taxes. If you are buying your first Toronto home, understanding what property taxes are and how to budget for them is important to long-term homeownership.
What Are Property Taxes?
Property taxes are paid annually. They are a tax devoted to property ownership collected by the City of Toronto. Anyone who owns property must pay property taxes. Just like in other cities, property tax rates also change over time and there is no avoiding them. The rate at which property taxes change is based on property assessment values and tax revenues.
How Do You Pay Property Taxes?
Property taxes can be paid by home ownership in a single payment. If you have the money available at closing time when you buy a home, paying your property taxes for the year is recommended by some. That can remove a bill from your budget. However, you can also split up property tax payments into installments and register for the City’s Pre-Authorized Tax Payment Program.
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Where Do Property Taxes in Toronto Go?
Property taxes are the primary source of revenue used by municipalities to fund basic local services. Property taxes are what pay for infrastructure and public works, i.e. repairing roads, funding transit systems, and more.
What Happens If I Do Not Pay Property Taxes?
If you do not pay property taxes, the City can take legal action against you and, after a period of non-payment, your property can be foreclosed upon.
How Is Toronto Property Tax Calculated?
Property tax is calculated in three steps. You have the municipality tax rate which is the largest part of this tax and it’s decided on by the City. You also have an education tax rate set by the province and that part of the tax is used to fund local schools and school boards. Lastly, there’s a City Building Fund Levy that is used for affordable housing, TTC maintenance, and similar City projects.
What Is The Current Toronto Property Tax Rate In 2023?
The following property tax rates are strictly for residential properties.
- City tax rate: 0.506079%
- Education tax rate: TBA
- City Building Fund: 0.007195%
The total tax rate in recent years has been in the 0.61%-0.7% range. That is calculated as the percentage of your property’s assessed value which is redone every year by the Municipal Property Assessment Corporation. There are differing property tax rates for multi-residential, commercial, industrial, and other types of properties.
How Do I Know My Property Taxes Have Been Received?
Every Toronto property owner has a property tax account automatically created for them through the City’s web portal. You can sign in online, see transactions and payments, and even set up payment schedules.
Property taxes are a part of homeownership. For new homeowners in Etobicoke, property taxes are something that one has to budget for when bidding on their dream home.
