If you are not aware or familiar with vacant home tax, our team at Budget Accounting is here today to fill you in on what you need to know. The goal of implementing a vacant home tax is to increase the supply of homes by deterring unoccupied residences. To continue reading what our Accounting in Richmond Hill team has to say on this topic, follow this guideline to get the latest scoop!
Vacant Home Tax
A home may be deemed vacant if there is no occupant or owner living in the residence for at least 6 or more months in the previous calendar year. Or a home may be deemed vacant if the owner fails to deliver a standing regarding the declaration of occupancy of the home. Although, the tax does not apply to residences that qualify for an exemption, properties that have a permitted occupant or tenant, and those that are the principal residence.
How Do You Calculate Vacant Home Tax?
If a home is declared vacant, a 1% of the CVA (Current Value Assessment) will be the penalty. For instance, if a home is assessed at $2,000,000, then 1% of that would be $20,000. This would be the amount that is owed in vacant home tax. The homes that qualify for vacant home tax will be notified in March/April and the tax will then become due on May 1st.
What Are The Penalties for Missed Deadlines?
Vacant home tax is something to take seriously because if you miss a deadline or payment, there will be profound consequences. If you do not declare the status of your property by the deadline, a $250 fine will be administered. In addition, if you fail to declare the status of your property, it will result in your home being deemed vacant and you will be forced to settle the appropriate tax. A vacant home tax notice will then be created and delivered. If you miss the payment date for your vacant home tax, interest will apply starting at 1.25%.
What Qualifies as an Exemption?
There are many reasons why a home may fall under the exemption category and therefore will not need to pay the vacant home tax. Some of the possible exemption reasons include a court order, a transfer of legal ownership, repairs/renovations that are taking place, death of the homeowner, or a principal residence in care.
How We Can Help
If you are interested in receiving more information on how vacant home tax works, our team at Budget Accounting would be happy to provide you with more information. Our team provides tax services such as income tax and Personal Tax Filing in Richmond Hill and we would be happy to help you with your taxes. To book a consultation with a member of our team, give our team a call today at (905) 508-5007. When you collaborate with our team, we will provide you with the highest quality of service for the lowest prices.