How do your residential property taxes in the Greater Toronto Area (GTA)?
Understand how taxes are determined. Taxes are calculated using two factors.
1) The first is the assessed value of the property and the second is the local tax rate. Throughout the Province of Ontario the responsibility for determining the value of property rests with the Municipal Property Assessment Corporation (MPAC), an independent organization established by the Province of Ontario. MPAC establishes values based on sales data for a given area to estimate the current or market value of similar properties. As property values differ from area to area similar houses can have very different assessed values.
2) The second factor used to determine property taxes is the local tax rate. Normally in any city in Ontario the tax rate comes from three sources. The first is for local services and it is set by the City Council annually. The second is for regional services and that rate is also determined by Regional Council annually. The last component is for education and the Province of Ontario establishes a standard rate across the province for all residential properties.
Because tax rates, other than education, are established locally they differ from municipality to municipality. For example the total 2012 residential tax rate in Brampton is approximately 1.1617%, while Toronto’s is approximately 0.7712%. On the surface it would appear that taxes in Brampton are higher, but this is not the case.
Annually an independent consulting firm, BMA Management Consulting (BMA), reviews the taxes of several Ontario municipalities comparing “like” properties. In the residential property class they review a detached bungalow and an executive home.
The detached bungalow is described as a three-bedroom single storey home with 1.5 bathrooms and a one-car garage. Total area of the house is approximately 1,200 square feet and the property is situated on a lot that is approximately 5,500 square feet. For this property the 2011 Brampton taxes were estimated at $3,424. The Toronto taxes on a similar property ranged from $2,486 in the east part of the city to $4,562 in the south. The average for the Toronto quadrants was $3,441, while the GTA average is $3,442.
The Municipal Tax Rate x the Assessed Value (CVA) of the Property
+
The Regional Tax Rate x the Assessed Value (CVA) of the Property
+
The Education Tax Rate x the Assessed Value (CVA) of the Property
=
The Total Property Tax
The executive home sampled is a two-storey, four or five bedroom home with three bathrooms, main floor family room plus atrium or library, an unfinished basement and an attached two-car garage. The house is approximately 3,000 square feet and would pay approximately $5,073 in Brampton. The range quoted in the survey for Toronto is $4,104(east) to $11,676(south) in Toronto. The average for the Toronto quadrants is $7,253, while the average for the GTA is $5,758.
