Handling Vacant Home Tax or Vacant Unit Tax (ON)

Handling Vacant Home Tax or Vacant Unit Tax (ON)

The Cities of Ottawa and Toronto introduced a new tax effective January 1, 2023. Either called Vacant Home Tax (in Toronto) or Vacant Unit Tax (in Ottawa), property owners (if applicable) are required to file a declaration to ensure the tax is not added to their property taxes.

Adding the Appropriate Wording to Documents

In RealtiWeb Ontario, the Issues list was updated to include Vacant Home/Unit Tax to handle the tax. Adding the Vacant Home/Unit Tax item to your RealtiWeb file will provide the places to enter text into various documents.

To add the Vacant Home/Unit Tax item to your file follow these steps:
  1. Navigate to the Issues screen.
  2. Click on Tax Issues and then Realty Tax and Local Improvements to open the list of available items.
  3. Click Vacant Home/Unit Tax. The Issues WorkBench for this Issue item will open for additional details to be added into the RealtiWeb file, and facilitate the adding of text into documents and the adjustment.
For how to change the text for each document available in the Issues WorkBench, please refer to this article that covers the Issues WorkBench in further detail and how clauses for documents are set in the Action List.

Specific Impacts to RealtiWeb Standard Documents

The Vacant Home/Unit Tax issue item provides standard and alternative clause text for the documents available from the Action List, and the Adjust/Payout option will add the adjustment into the Account to Client screen (and corresponding document).

Documents that are impacted by the Vacant Home Tax and Vacant Unit Tax are listed below with the added clause text.

Document Name
Condition
Clause Text
Vendor - Initial Letter
​
















Added if Vacant Home/Unit Tax issue in file















The [Name of Municipality] has passed a Vacant Unit/Home Tax by-law that requires all owners of "Residential Units" to file an annual occupancy declaration to confirm the occupancy status of the Property in the prior year. Property that is vacant for more than 6 months in the prior year will be subject to a tax of 1% of the property's value in the current year. Although the tax does not apply to a principal residence, the requirements to file an occupancy declaration also applies to a principal residence.

In order to facilitate the completion of the sale of the Property please ensure that you have filed the requisite occupancy declaration for the Property and provide us with that filed copy as soon as possible.
Vendor - Initial Letter



Added if Vacant Home/Unit Tax issue in file

[Number]. Copy of [Closing Date] Occupancy Declaration filed with the [Name of Municipality]
​
Undertaking, Warranty, Direction and Declaration - Vendor's




Added if Vacant Home/Unit Tax issue in file (Note: Underlined text is added to the document)



[Number]. pay all realty taxes (including interest penalties and any re-assessments of the property) and utility accounts owing for services, with respect to the Property, up to the date of closing as well as the full amount of any vacant home/unit tax and any interest late filing fees or penalties charged against the Property.
Undertaking, Warranty, Direction and Declaration - Vendor's


Added if Vacant Home/Unit Tax issue and tax is not applicable


[Number]. the Property was not vacant (as defined by the Vacant Home/Unit Tax by-law for the [Name of Municipality]) in the calendar year prior to the year in which the completion of the sale of the Property has taken place.
Undertaking, Warranty, Direction and Declaration - Vendor's

Added if Vacant Home/Unit Tax issue and tax is applicable

[Number]. the Vacant Home/Unit Tax levied or to be levied against the Property has been paid or credited to the Purchaser on the statement of adjustments.
Undertaking, Warranty, Direction and Declaration - Vendor's

Added if Vacant Home/Unit Tax issue

​
[Number]. the information contained in the occupancy declaration filed with the [Name of Municipality] a copy of which declaration has been provided to the Purchaser is true and correct.



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