The City will be charging a vacancy tax if a property is vacant for more than half the year. Created by Dall-E
Two new programs implemented by City Council are set to have an impact in 2025, with the municipality’s Vacant Unit Tax set to begin and the new anti-renoviction bylaw already in effect as of Jan. 1.
Hamilton’s Vacant Unit Tax was officially confirmed in April 2024, with the rollout set for 2025.
The City will be charging a tax of one per cent of a property’s assessed value on a residential unit that is vacant for more than 183 days in a calendar year (approximately six months).
That means that a property owner with the average Hamilton home (based on the city’s average home assessment value of $385,900) would have to pay $3,859 per year if that property is deemed vacant.
Additionally, every single property owner in Hamilton must submit a mandatory declaration of the status of their property every year.
Those who fail to submit the declaration will have their unit considered vacant and will be charged the tax.
The city’s declaration period was originally supposed to be open from Jan. 13 to March 31, 2025 with a late declaration period (which would come with a $250 late fee) planned for April 1 to April 30, 2025.
However, the month-long 2024 Canada Post labour disruption impacted the city’s “Notice to Declare” letters that were mailed out in December.
As such, city staff recommended rescheduling the declaration period to start on Feb. 10, 2025 with a deadline of April 30, 2025.
Staff also recommended waiving the $250 late fee for declarations made after April 30, 2024. The fee will continue to apply in subsequent years.
Both recommendations were approved by City Council.
There are a number of exceptions to the tax, such as if there is the death of an owner, major renovations, the sale of the property, or if the principal resident is in care, institutionalized, or hospitalized.
Non-profit housing is also exempt from the tax.
The city will be conducting audits of occupancy declarations on an annual basis to ensure compliance.
Costs associated with implementing the tax total $2.6 million, with annual operating expenses past 2025 pegged at $2.2 million per year.
There are concerns that the program might not recoup enough in taxes to make it profitable for the city.
There are also concerns that seniors and other residents may not be aware of the tax or how to properly declare and that people will be taxed accidentally even though their homes are occupied.
The city says that the declaration form will be available online starting on the first day of the declaration window, but a printable form will also be available upon request and there will be options to fill it out over the phone and in person.
Another program, the city’s Renovation Licence and Relocation By-Law that is meant to address “bad faith evictions,” commonly referred to as “renovictions,” is already in effect as of Jan. 1, 2025.
Under the Ontario Residential Tenancies Act (RTA), landlords have the right to evict tenants if there are plans for major repairs or renovations that require a building permit and vacant possession.
However, the landlord must give the tenant the opportunity to return to their unit at the current rental rate upon completion. That sometimes does not happen.
Under the new municipal by-law, landlords who issue an eviction notice (N-13) to a tenant to demolish, repair, or renovate a unit must apply to the city within seven days for a renovation licence before starting any work.
The renovation licence will cost $715 per unit, with an annual renewal fee of $125.
Additionally, landlords will be required to have all building permits already in place and will have to provide an engineer’s report showing that vacant possession is necessary in order for work to be completed.
Also under the bylaw, if a tenant is required to leave their unit during a renovation and has plans to return to the unit then landlords must secure temporary arrangements for the tenant that are comparable to the tenant’s current unit or provide the tenant compensation.
The new bylaw, along with the Safe Apartment Buildings Bylaw, meant that Council approved the hiring of 28 new full-time employees to the city’s Licensing and Bylaw Services Division.
City staff only expect licensing fees to cover about 10 per cent of the program’s costs, meaning that taxpayers will cover the rest – about $800,000 per year.
Based in Hamilton, he reaches hundreds of thousands of people monthly on Facebook, Instagram, TikTok, and Twitter. He has been published in The Hamilton Spectator, Stoney Creek News, and Bay Observer. He has also been a segment host with Cable 14 Hamilton. In 2017, he received the Chancellor Full Tuition Scholarship from the University of Ottawa (BA, 2022). He has also received the Governor General’s Academic Medal. He formerly worked in a non-partisan role on Parliament Hill in Ottawa.
