Under Section 131 of the Residential Tenancies Act (RTA), tenants are entitled to an automatic rent reduction when their landlord’s property taxes have been reduced by more than 2.49 per cent from one year to the next. The City is required to send notices of rent reduction to landlords by September 15 and to tenants by December 15. While the tenant does not have to get permission from the landlord to automatically reduce the rent, it is recommended that tenants talk with their landlords prior to the effective date on December 31. At the end of each year, a listing of rental residential properties is provided by the City.
The RTA prescribes that if property taxes have been reduced by more than 2.49 per cent between two consecutive years, the rent reduction is equal to the percentage decrease in property taxes from one year to the next, and then multiplied by:
- 20 per cent for rental residential properties in the multi-residential property tax class, or
- 15 per cent for rental residential properties in the residential or new multi-residential property tax class.
City Council approved that Expanded Notices be mailed to landlords and tenants of eligible buildings where property tax decreases of more than 2.49 per cent occurred as a result of changes that happened after regular legislated notices were mailed. Property tax changes may result from assessment appeals, tax classification changes or supplementary or omitted assessment changes to a property tax account.
The Expanded Notices are not notices for the purposes of Section 131 of the RTA, they are provided for information only. As such, the City cannot determine whether a tenant is entitled to a rent reduction after receiving these notices. Tenants can either come to an agreement with their landlord, or make an application to the Landlord and Tenant Board to determine whether a rent reduction applies, and the amount of the rent reduction, if any.
For more information regarding rent reduction please go to this link
