TRREB – Toronto City Council Approves Small Business Property Tax Class – Toronto Real Estate Board

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Toronto City Council has approved a new small business property tax class, to allow for a 15 per cent property tax reduction for small businesses. TRREB has supported this policy as an important way to encourage economic development.  

The new small business property tax subclass will come into effect for the 2022 tax year. It is estimated that property tax reductions will apply to approximately 25,000 small businesses across Toronto, or 60 per cent of all commercial properties.

Businesses will be eligible if they meet either of the following criteria:

  1. Businesses located downtown, on the central waterfront, in designated growth centres or avenues in the City of Toronto’s Official Plan:

    – Properties must be classified within the commercial or new commercial tax class

    – Properties must have a Current Value Assessment (CVA) of less than or equal to $7 million

    – Lot size must be 7,500 square feet or less;, or for commercial condos, a gross floor area of 2,500 square feet or less
  1. Businesses located anywhere else in the city:

    – Properties must be classified within the commercial or new commercial tax class

    – Properties must have a CVA of less than or equal to $1 million

Small business property owners do not need to apply for this tax relief, as all commercial properties will be assessed for eligibility. A request for reconsideration or appeal process will be available for property owners who feel that their property should be included in the new tax subclass.

The City of Toronto has indicated that the provincial government is expected to match the municipal tax rate reduction with a corresponding reduction in the business education tax for all eligible small business property owners.

More detail on the City’s new Small Business Property Tax Class is available here.