Toronto’s Vacant Home Tax is designed to push empty properties back into the housing supply. At 3% of assessed value, it can cost property owners $15,000–$30,000+ per year on a single vacant property. Whether you own one home or several, here is what you need to know.
How the Toronto Vacant Home Tax works
| Component | Details |
|---|---|
| Official name | Vacant Home Tax (VHT) |
| Introduced | January 1, 2022 (first tax year) |
| Current rate | 3% of Current Value Assessment (CVA) |
| Applicable area | City of Toronto only (not the GTA) |
| Who must declare | Every residential property owner in Toronto |
| Declaration deadline | Typically February of the following year |
| Penalty for not declaring | Property deemed vacant — VHT applied automatically |
Rate history
| Tax Year | Rate |
|---|---|
| 2022 | 1% |
| 2023 | 1% |
| 2024 | 3% |
| 2025 | 3% |
What it costs you
| Property CVA | VHT at 3% | Plus Regular Property Tax (~0.63%) | Total Annual Tax If Vacant |
|---|---|---|---|
| $500,000 | $15,000 | $3,150 | $18,150 |
| $700,000 | $21,000 | $4,410 | $25,410 |
| $1,000,000 | $30,000 | $6,300 | $36,300 |
| $1,500,000 | $45,000 | $9,450 | $54,450 |
| $2,000,000 | $60,000 | $12,600 | $72,600 |
Who must declare
Every owner of residential property in Toronto must file a Declaration of Occupancy Status each year. This includes:
| Property Type | Must Declare? |
|---|---|
| Single-family home (occupied) | Yes — declare as occupied |
| Condo unit (occupied) | Yes — declare as occupied |
| Principal residence you live in | Yes — declare as occupied |
| Rental property (tenanted) | Yes — declare as occupied with tenant |
| Vacant house | Yes — declare as vacant (VHT applies) |
| Vacant condo (investment, unused) | Yes — declare as vacant (VHT applies) |
| Property under renovation | Yes — declare and claim exemption |
| Multi-residential (4+ units) | Exempt from declaration |
What counts as “vacant”
A residential property is vacant if it was not occupied for at least six months during the calendar year.
| Scenario | Vacant? | VHT Applies? |
|---|---|---|
| You live in it as primary residence (12 months) | No | No |
| Rented to a tenant 8 months, empty 4 months | No | No |
| Rented to a tenant 4 months, empty 8 months | Yes | Yes |
| Used as Airbnb (short-term rental, no principal occupant) | Likely yes | Likely yes |
| Family member lives there 7 months | No | No |
| Completely empty all year | Yes | Yes |
| Used as a pied-à-terre occasionally | Depends — likely yes | Likely yes |
The six months do not need to be consecutive. Total occupancy across the year must equal at least six months.
Exemptions
| Exemption | Details | Documentation Needed |
|---|---|---|
| Death of owner | Property vacant due to owner’s death — exempt during estate administration (up to stated period) | Death certificate, estate documentation |
| Active renovation | Property undergoing renovation with valid City building permits | Building permit numbers, contractor evidence |
| Court order | Legal order prevents occupancy | Court order documentation |
| Long-term care/hospital | Owner admitted to long-term care or hospital | Medical/institutional documentation |
| Recent sale | Property sold during the tax year | Transfer documentation |
| Principal residence | Owner occupies as primary residence 6+ months | Declaration |
| Transfer of ownership | Change in ownership during the year | Land registry |
| Legal prohibition | Regulatory or legal restriction on occupancy | Government order |
Critical: Exemptions are NOT automatic. You must still file your declaration and select the applicable exemption. Failing to declare means you are deemed vacant regardless of exemption eligibility.
How to declare
Online declaration (recommended)
| Step | Details |
|---|---|
| 1 | Go to toronto.ca/vacanthometax |
| 2 | Enter your property assessment roll number (from your property tax bill or MPAC notice) |
| 3 | Verify your property address |
| 4 | Select occupancy status: occupied or vacant |
| 5 | If claiming an exemption, select the exemption category and provide details |
| 6 | Submit by the deadline |
Other declaration methods
| Method | Details |
|---|---|
| Phone | 311 (City of Toronto) |
| Paper form available on request | |
| In person | City of Toronto service counters |
Penalties and enforcement
| Violation | Penalty |
|---|---|
| Failure to declare by deadline | Property deemed vacant — 3% VHT applied |
| Late declaration (after deadline) | May still be possible with penalty |
| False declaration (claiming occupied when vacant) | Up to $10,000 fine per day of continuing offence |
| Non-payment of VHT | Added to property tax account — accrues interest and can lead to tax sale |
Audit and verification
The City of Toronto may audit declarations. They can use:
- Utility consumption data (low usage suggests vacancy)
- Canada Post mail delivery records
- Neighbour complaints
- Rental registry information
- Property insurance records
If audited and found to have made a false declaration, you face the VHT assessment plus fines.
Impact on property investors
| Investor Scenario | VHT Impact | Strategy |
|---|---|---|
| Buy-and-hold with tenant | No VHT — property occupied | Maintain tenancy |
| Renovation flip | Exempt with valid building permits | Ensure permits are active and filed |
| Empty property awaiting development | VHT applies | Consider interim rental or apply for permits |
| Snowbird (away 5 months, home 7 months) | No VHT — occupied 6+ months | Keep utility and occupancy records |
| Airbnb (no primary occupant) | Likely VHT applies | Review rules — may need a primary occupant |
| Foreign-owned vacant property | VHT applies + federal Underused Housing Tax | Consider renting or selling |
Comparison: Toronto VHT vs Vancouver Empty Homes Tax
| Feature | Toronto VHT | Vancouver EHT |
|---|---|---|
| Year introduced | 2022 | 2017 |
| Current rate | 3% of CVA | 5% of assessed value |
| Declaration required | Yes — annual | Yes — annual |
| Vacant threshold | Unoccupied 6+ months | Unoccupied 6+ months |
| Penalty for non-declaration | Deemed vacant | Deemed vacant |
| VHT on $1M property | $30,000 | $50,000 |
| Exemptions | Renovation, death, court order, LTC, etc. | Similar — renovation, death, medical, etc. |
Other Canadian cities with vacancy taxes
| City/Province | Vacancy Tax | Rate | Status |
|---|---|---|---|
| Vancouver | Empty Homes Tax (EHT) | 5% | Active |
| Toronto | Vacant Home Tax (VHT) | 3% | Active |
| Ottawa | Under consideration | TBD | Proposed |
| BC (provincial) | Speculation and Vacancy Tax | 0.5%–2% | Active (certain regions) |
| Federal | Underused Housing Tax (UHT) | 1% | Active (non-resident/non-citizen owners) |
Overlap with the federal Underused Housing Tax (UHT)
The federal Underused Housing Tax is a separate 1% annual tax on vacant or underused Canadian residential property owned by non-Canadian citizens or non-permanent residents. It can apply on top of the Toronto VHT:
| Owner Type | Toronto VHT | Federal UHT | Total on $1M Vacant Property |
|---|---|---|---|
| Canadian citizen, property vacant | 3% ($30,000) | Not applicable | $30,000 |
| Permanent resident, property vacant | 3% ($30,000) | Not applicable | $30,000 |
| Non-citizen/non-resident, property vacant | 3% ($30,000) | 1% ($10,000) | $40,000 |
Tips for Toronto property owners
| Tip | Details |
|---|---|
| Always declare on time | Even if occupied — failure to declare = deemed vacant |
| Keep occupancy records | Utility bills, tenant leases, insurance records |
| If renovating, get permits first | VHT exemption requires valid City permits |
| Budget for VHT if property will be vacant | $15,000–$60,000+ per year at 3% |
| Short-term vacancy between tenants | If total occupancy for the year exceeds 6 months, not vacant |
| Consider renting between uses | Even a 6-month lease prevents VHT |