Every year, Toronto property owners get caught off guard by the Vacant Home Tax — not because they can't pay it, but because they simply forget to file the required declaration. Here's what you need to know before the deadline catches you.
What the Vacant Home Tax Actually Is
The City of Toronto requires every residential property owner to submit an annual declaration confirming their property's occupancy status for the previous calendar year — regardless of whether the property was actually vacant. If your property is declared (or deemed) vacant for more than six months in the year without a qualifying exemption, you owe a tax calculated as a percentage of your property's current value assessment (CVA).
Why This Hits Non-Resident Owners Hardest
If you own a Toronto property but live outside Canada — or even outside Toronto — you're just as required to file the annual declaration as any resident owner. Non-resident owners are disproportionately represented among people who miss the declaration entirely, simply because they're not physically present to receive mailed notices or local reminders about the deadline.
The Two Ways You Get Caught
Genuine vacancy. The property was actually unoccupied for more than six months without a qualifying exemption (major renovations, medical circumstances, recent purchase, etc.).
Missed declaration. Even if your property was fully occupied by a tenant or yourself all year, failing to file the declaration by the deadline results in your property being deemed vacant by default — triggering the tax regardless of actual occupancy.
The second scenario is by far the more common way owners end up paying this tax unnecessarily. The City does not assume occupancy in the absence of a filed declaration — silence is treated as a vacancy claim against you.
What Qualifies as a Valid Exemption
Common exemptions include:
The property was the principal residence of the owner or a permitted occupant.
The unit was rented to a tenant for residential purposes for at least six months of the year (in total, not necessarily consecutive).
The owner passed away during the vacancy period.
The property required renovations that made occupancy impossible, subject to permit documentation.
The owner was in a hospital or long-term care facility during the vacancy period.
What This Means If You Rent Out Your Property
If your property was tenanted for the required period, you're exempt — but you still have to file the declaration confirming this, every year, without exception. A rented property with no declaration filed is treated identically to a genuinely vacant one under the City's process.
This is exactly the kind of administrative deadline that's easy to lose track of if you're managing the property yourself, especially as a non-resident owner juggling different time zones and mailing addresses. It's also why we handle Vacant Home Tax filing as part of our non-resident services — one missed declaration can cost far more than an entire year of professional management fees.
The Non-Resident Tax Layer on Top
If you're a non-resident owner, remember that Vacant Home Tax exists in addition to, not instead of, your other non-resident tax obligations — including NR4/NR6 filings and monthly remittance requirements on rental income. These are separate systems administered by different bodies (the City of Toronto vs. the Canada Revenue Agency), and confusing one for the other is a common and costly mistake.
The Bottom Line
The Vacant Home Tax rarely catches owners because they were genuinely trying to leave a property empty — it catches owners, and non-resident owners especially, who simply missed the annual declaration deadline. Filing on time, every year, regardless of your property's actual occupancy status, is the single most important habit to build.
Own a Toronto property and want us to handle your Vacant Home Tax declaration and broader non-resident tax obligations? Learn about our non-resident services or contact our team directly.
This article summarizes general City of Toronto policy and is not tax or legal advice. Confirm current deadlines and exemption criteria directly with the City of Toronto before filing.
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