Wednesday, February 17, 2010

Obtaining property tax rebates for vacancies in 2009

In the depths of the economic downturn of 2009, many landlords and businesses found portions (or even all) of their properties vacant for significant periods of time. Whatever the reason for the vacancy, the cost of maintaining that unused space continued for a landlord who lost tenants or a manufacturer who shut down a plant or a portion of a plant. One component of those expenses were the property taxes.

There is a way by which a portion of the property taxes can be recovered.

Commercial or industrial properties located in Ontario may be eligible for a refund of up to 35% of the property taxes paid for vacant units or properties. It is however not an automatic refund. A landowner must make an application for that refund, backed up by appropriate documentation and satisfy the conditions for the refund.

The vacant area must either be the entire building or a physically segregated part of the building. The vacant area must not have been rented or occupied for at least ninety (90) consecutive days in 2009. The property must be assessed as being either in the commercial or industrial property classes. The amount of the rebate is dependant upon the property class of the unit or building that was vacant and the period of time it was vacant. If the building or portion of the building was not used because renovations, repairs or construction was being carried out, it may still be eligible for the rebate.

There is however, a deadline. The application must be made no later than February 28, 2010 for vacancies in 2009. Failure to apply by that date is fatal.

The municipality normally responds within 120 days. There is an appeal from a decision of the municipality to not grant the rebate or if the landowner is not satisfied with the amount of the rebate. That appeal must be made within 120 days of the day the decision of the municipality is mailed to you. Once again failure to make that appeal within the appeal period is fatal.

There is also an appeal if the municipality simply fails to determine whether you are eligible for the rebate. The appeal can usually be made once 120 days have elapsed after the application was received.

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