The City of Ottawa’s Vacant Unit Tax: Key Details for Property Owners

Published on 28 February 2025, 06:49:34 PM

In 2022, the City of Ottawa implemented a Vacant Unit Tax (VUT) to address the growing housing shortage and encourage property owners to maintain, occupy, or rent their properties, thereby increasing the housing supply. If you own property in Ottawa, it’s important to understand how this tax works, who it applies to, and what you need to do to stay compliant.

What Is the Vacant Unit Tax?

The VUT is an annual tax applied to residential properties that remain vacant for 184 days or more in the previous calendar year. Exemptions apply for specific situations, such as properties under renovation that keep it vacant, farms with residences, or owners living in long-term care facilities. All Ottawa homeowners must submit an annual declaration confirming whether their property was vacant or occupied.

How Much Is the Tax?

The tax is set at 1% of the assessed value of the property. For example, if your property is assessed at $500,000, you would owe $5,000 if it remains vacant for more than six months without an exemption. Starting in 2025, the tax rate will increase by 1% for each consecutive year a unit remains vacant, up to a maximum of 5% of the property’s assessed value.

Key Deadlines & How to File

The declaration deadline is March 20, 2025, while late declarations being accepted until April 30, 2025, with a $250 late fee. Failure to file may result in penalties and an automatic classification of the property as vacant, leading to taxation. Declarations can be completed online through the City of Ottawa’s website.

Final Thoughts

If you own property in Ottawa, staying informed about the Vacant Unit Tax is crucial to avoiding unnecessary penalties and ensuring compliance. To learn more about how this and other real estate policies impact you, visit AxessLaw.com/blog for expert insights and updates.