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The Toronto Vacant Home Tax Becomes a Lien, and Buyers Inherit It


The Toronto Vacant Home Tax Becomes a Lien, and Buyers Inherit It

Toronto’s Vacant Home Tax applies to homes vacant more than six months in a year, at 3% of Current Value Assessment from the 2024 taxation year. Every owner must declare occupancy by April 30 each year even if they live there. A property with no declaration is deemed vacant, a Notice of Assessment is issued, and the unpaid tax becomes a lien on the property which the purchaser inherits.
Last updated: August 2026
3%
Of Current Value Assessment, from the 2024 tax year
April 30
Annual declaration deadline, even if you live there
The buyer inherits it
Unpaid, it attaches to the property as a lien

Here is a scenario that should worry any Toronto buyer.

You buy a house. It closes. Months later a Vacant Home Tax bill arrives for a year you did not own
it, because the previous owner never filed a declaration. And it is now your problem, because the
tax attaches to the property.

That is not a hypothetical risk. It is how the City says the tax works.

What the tax is

Toronto’s Vacant Home Tax applies to residential property left vacant for more than six months in
a calendar year. Beginning with the 2024 taxation year the rate is 3 percent of the
property’s Current Value Assessment, up from 1 percent when the tax started.

Three percent of assessed value is not a nuisance charge. On a property assessed at $1,200,000
that is $36,000 for a single year.

The part that catches people: you must declare even if you live there

This is a declaration regime, not an assessment regime. The City does not work out who is vacant.
Every residential property owner files a declaration of occupancy status each year, by
April 30.

If you do not file, the property is deemed vacant. Not investigated. Deemed. You
can have lived there all year with your family and the tax still lands, because the failure being
punished is the failure to declare.

The unpaid tax becomes a lien on the property, and the buyer inherits it

This is the part that matters most in a transaction and is almost never discussed. The City states that where no declaration is made the property is treated as vacant, a Notice of Assessment is issued, and the tax becomes a lien attached to the property, with purchasers inheriting the liability. So a Vacant Home Tax problem created by a seller does not stay with the seller. It travels with the house, to you. Interest applies at 1.25 per cent on the first day of default, and false declarations or failing to provide requested information can attract fines up to $10,000.

Five step diagram showing how an undeclared Toronto Vacant Home Tax becomes a lien on the property that the purchaser inherits.

What a buyer should actually do

1

Ask for proof of the declaration, not a reassurance
A seller saying they filed is not the same as seeing it. Your lawyer should be asking for evidence of the declaration and the property’s Vacant Home Tax status as part of the searches.
2

Deal with it in the agreement
The statement of adjustments and the closing documents are where this gets handled. A holdback or an explicit covenant costs nothing to include and is worth a great deal if there is a problem.
3

Be careful with anything that has sat empty
Estate sales, renovation projects, properties held by an owner living abroad, and anything that has clearly been unoccupied deserve a specific question rather than an assumption.
4

Diarise your own first declaration
As the new owner you are now in the annual cycle. The portal typically opens in the autumn and the deadline is April 30. Put it in your calendar the day you close.

Exemptions exist, but you have to claim them

There are exemptions for situations like the death of the owner, a property undergoing repairs or
renovations, and certain other circumstances. The critical procedural point is that exemptions are
not applied automatically. You claim the exemption on the declaration and you should be ready to
document it if the City asks.

A property that qualified for an exemption and did not claim it is in the same position as a
property that was genuinely vacant.

Where this bites in the GTA

The tax is a City of Toronto tax. It does not apply in Markham, Vaughan, Richmond Hill or
Newmarket. If you own in Toronto and elsewhere, do not assume the same rules cover both, and do not
assume a property manager or a family member filed on your behalf.

This is general information, not tax or legal advice

Rates, exemptions and deadlines are set by the City and have already changed once. Confirm the
current position on the City of Toronto’s Vacant Home Tax page, and involve your real estate
lawyer on any transaction where a property may have been unoccupied.

Sources: City of Toronto, Vacant Home Tax, for the 3 per cent Current Value Assessment rate beginning with the 2024 taxation year, the April 30 declaration deadline, the treatment of undeclared properties as vacant, the lien attaching to the property with purchasers inheriting liability, interest at 1.25 per cent on the first day of default, and fines up to $10,000.

Where This Comes From

Written from the City of Toronto’s own Vacant Home Tax pages. The tax is a City of Toronto tax and does not apply in York Region municipalities.

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Frequently Asked Questions

How much is Toronto’s Vacant Home Tax?
Beginning with the 2024 taxation year the rate is 3 per cent of the property’s Current Value Assessment, increased from 1 per cent when the tax was introduced. On a property assessed at $1,200,000 that is $36,000 for a single year.
Do I have to declare if I live in my home?
Yes. It is a declaration regime. Every residential property owner files a declaration of occupancy status each year by April 30, whether the home is occupied, vacant or exempt. A property with no declaration is deemed vacant regardless of who actually lived there.
What happens if the previous owner did not declare?
The City states that where no declaration is made the property is treated as vacant, a Notice of Assessment is issued, and the tax becomes a lien attached to the property, with purchasers inheriting the liability. This is why the status should form part of your lawyer’s searches.
Does the Vacant Home Tax apply in Markham or Vaughan?
No. It is a City of Toronto tax. Owners with property in both Toronto and York Region should not assume one set of rules covers both.
Are there exemptions from the Vacant Home Tax?
Yes, for circumstances such as the death of the owner or a property undergoing repairs, but exemptions are not applied automatically. You must claim the exemption on the declaration and be prepared to document it. An unclaimed exemption is treated the same as a vacant property.

Related Reading

If you are buying anything in Toronto that has sat empty, an estate property, a renovation project, or a place owned from abroad, make sure this is on your lawyer’s list. Happy to flag it on any property you are looking at.

Adam Nadler
Team Lead, Vision Real Estate
RE/MAX Your Community Realty, Brokerage
Website
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