Property taxes can be confusing. There’s a lot to consider and understand, but the bottom line is, if you own property, you owe tax on that property.
Fortunately, the City of Toronto has a Property Tax Calculator that actually shows how your money is being distributed to various services and infrastructure developments and maintenance.
Before jumping into the numbers, it’s important to know that your property taxes are determined by the cost of your home or by the Municipal Property Assessment Corporation. Some people are concerned about spiking home values resulting in higher property taxes, but MPAC ensures the increases in value are phased in to avoid sudden spikes in property taxes.
There are three factors determining your property taxes; the City’s tax rate, the education tax rate, and the city building tax rate.
“The City levy has been calculated by multiplying your property’s 2019 phased-in assessment by the City’s tax rate, as approved by Toronto City Council,” explains the City of Toronto website. “The education levy is calculated by multiplying your 2019 phased-in assessment by the education tax rate, as set by the Province of Ontario. The City Building fund levy is calculated by multiplying your 2019 phased-in assessment by the City Building fund tax rate, as approved by Toronto City Council.”
Let’s use a home valued at $800,000 as an example. The City tax would amount to $3,612.54, the provincial education tax comes in at $1,288.00, and the contribution to the city building fund would be $17.62, all for a total of $4,918.16.
Currently in the City of Toronto, the largest chunk of property taxes goes towards the Police Service & Board (in the case of the example above, more than $800 is allocated to this department). The next highest in descending order include the TTC, Debt Charges, Fire Services, and Parks, Forestry & Recreation.
Overall, there are 13 areas that your property taxes are diverted to. The bottom five receiving the least money include Economic Development & Culture, Toronto Paramedic Services, Children’s Services, Toronto Employment & Social Services, and the Toronto Public Library.
If you’re interested in seeing how your property taxes are being spent in the City of Toronto, we highly recommend using the Property Tax Calculator!