Are you paying more than your fair share in property taxes?

Many Canadian property owners accept their property tax assessments without question, even if they feel the values are too high. However, Canada’s diverse markets make it challenging for assessors to accurately estimate the market value of your property — which means you may be paying more than your fair share in property taxes.

Due to the sheer volume of property assessments, authorities across the country rely on assessment models to value properties. While these models allow the assessment department to value numerous properties efficiently, they may not account for the unique characteristics of each property.

Consequently, the use of these models can sometimes result in inflated valuations and unnecessarily high taxes. A review of your assessment can help you understand whether you are paying more than your fair share in property taxes when compared to competing properties.

Why should you consider having your assessment reviewed?

You should consider having your property assessment reviewed for several reasons, including:

• Error-prone assessments: Errors can occur during the process and persist for years due to the large number of properties that assessors must value.
• Limited market insight: The effectiveness of the assessment model depends heavily on the quality of data it uses. A notable scarcity of sales or lease data for specific property types and areas within each province can result in assessments for these properties being above market value.
• Operating costs: Property taxes are often the most significant operating expense for businesses when leasing or renewing.
• Competitive edge: Regular reviews of the property taxes for properties that are leased helps keep operating costs low. These low costs make it easier to renew existing tenants or lease the properties.
• Future tax exposure: The advisor who reviews your property assessment may also be able to model the tax exposure of new developments. Getting ahead of this adds value when leasing out a new building and budgeting for tax increases.
• Property tax trends: Municipalities must increase their property taxes to keep pace with rising costs. Regular assessment reviews ensure that owners are only paying their fair share of these taxes. Many programs exist outside the typical assessment review that provide taxpayer rebates, grants, or exemptions. An advisor can help you explore these opportunities with each property.

Substantial reductions to your property tax liability may be possible by effectively managing property taxes and pursuing assessment appeals. This can also positively impact leasing and the overall value of the property.

How does the review process work?

The review process begins by meeting with an advisor to set expectations, discuss challenges, and provide an overview of legislation. A comprehensive review is then conducted to determine if the value placed on your property is assessed at market or fairly assessed compared to similar properties.

An advisor will analyze assessment parameters, physical characteristics, and potential assessment and tax class advantages for each property. They will present a detailed rationale supporting each appeal, backed by market evidence to resonate with tribunals. By examining income statements, analyzing rent rolls, and evaluating comparable properties, an advisor can assess whether the municipality has accurately estimated your property’s fair market value.

The advisor will actively engage with assessors to review municipal and represent you throughout all stages of the assessment tribunal process to effectively advocate for your interests. Their knowledge and experience can help minimize the risk of missed opportunities and unproductive appeals.