Do renters pay property tax?

Not directly. The property tax bill goes to the owner of the property, and the owner is the one the municipality collects from. In Ontario, the Municipal Act, 2001 says taxes "may be recovered with costs as a debt due to the municipality from the taxpayer originally assessed for them and from any subsequent owner of the assessed land" (s. 349 (1)). A tenant is not on that list.

Renters do pay for it indirectly. Ontario's Landlord and Tenant Board puts it this way: "Most tenants do not pay property taxes separately from their rent. In most situations, the rent a landlord charges a tenant includes a portion which helps the landlord cover property taxes."

That indirect link is why some provinces count part of a tenant's rent as property tax for credit purposes, and why Ontario lowers rents automatically when a landlord's property tax falls by more than a set amount. Both are explained below.

It depends on the building, the city's tax rates and the rent, so there is no single figure. Ontario uses two averages in its rent rules. The Landlord and Tenant Board says: "On average, the amount that a landlord must pay for property taxes in a complex of 7 or more units is equal to 20% of the landlord's total rent revenue for that complex. The average amount that a landlord must pay for property taxes in a complex containing 6 or fewer units is estimated at 15%."

Rental apartment buildings can also be taxed at a different rate from houses. In Toronto, the 2026 total tax rate is 0.767311% for the Residential class and 1.208792% for the Multi-Residential class, while the New Multi-Residential class pays the residential rate of 0.767311%. So for the same assessed value, a property in Toronto's Multi-Residential class carries a higher tax bill than a house.

In Ontario, a fall in the landlord's property tax lowers rent by law. The City of Toronto explains: "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 Landlord and Tenant Board gives the formula as the percentage decrease in taxes multiplied by 20% for a complex with 7 or more units, or by 15% for 6 or fewer units. Toronto words the same rule by tax class: 20% for the multi-residential class, 15% for the residential or new multi-residential class. The LTB's example: taxes fall from $20,000 to $18,000, a 10% decrease; 20% × 10% = a 2% rent reduction, so rent of $800 becomes $784.

Municipalities must send notices for complexes with 7 or more units. Toronto sends them "to landlords by September 15 and to tenants by December 15", and the reduction takes effect on December 31. Smaller buildings get no notice, but the LTB says "the automatic rent reduction rules apply to these complexes as well." Public housing, non-profit housing and non-profit co-ops are among the exceptions. An application to the Board to vary the amount (Form A4) is due by the later of March 31 of the year after the reduction took effect and the 90th day after the rent reduction notice was issued, according to the LTB.

The unpaid tax is still the owner's debt, but in Ontario the municipality can reach the rent. Section 350 (1) of the Municipal Act, 2001 says: "Where taxes are owed in respect of any land occupied by a tenant, the treasurer may give the tenant notice in writing requiring the tenant to pay the rent in respect of the land to the treasurer as it becomes due up to the amount of the taxes due and unpaid plus costs, and the tenant shall comply with the notice."

The tenant is protected from paying twice. Under s. 350 (3), "Any amounts paid by a tenant under subsection (1) or (2) that, as between the tenant and the landlord, the latter ought to have paid may be deducted by the tenant from the rent." Collecting rent this way "does not impose upon the treasurer or the municipality the responsibilities of a landlord" (s. 350 (2)).

Collection powers outside Ontario are set by each province's municipal legislation; this guide quotes only the Ontario provision.

Several provincial credits are open to tenants because rent includes property tax:

- Ontario. The Ontario Energy and Property Tax Credit is open to people who in 2025 "rented, and your landlord was required to pay property tax for your main residence", according to Ontario. On the CRA's 2026 calculation sheet, the first step is to "Multiply your rent paid in Ontario for 2025 by 20%", then add any property tax paid; the result is the "occupancy cost". Rent counts only for a home "subject to Ontario municipal or school property tax", so rent for a tax-exempt social housing unit or a home on a reserve does not count. - Manitoba. Manitoba has a separate Renters Affordability Tax Credit. Manitoba Finance's Budget 2026 bulletin says that "Effective for the 2026 tax year, the maximum annual Renters Affordability Tax Credit is increased to $625, and the maximum seniors' top-up is increased to $357." For 2027 the maximum rises to $675 and the seniors' top-up to $385.71. - Quebec. The housing component of the solidarity tax credit covers owners and tenants of an eligible dwelling on December 31, 2025. Revenu Québec says tenants enter the dwelling number and the number of tenants from the RL-31 slip, which landlords must give "to every person who, on December 31, 2025, was a tenant or subtenant" of an eligible dwelling.

Eligibility for the Ontario credit is determined by the Canada Revenue Agency, and for the Quebec credit by Revenu Québec. Manitoba's bulletin refers questions about its credit to the Canada Revenue Agency.

People who own a mobile home or land-lease home but rent the lot sit between owner and tenant. The CRA defines a land-lease home as "a home you own but lease the lot it sits on."

For the Ontario Energy and Property Tax Credit, the lot rent is not entered as rent. The CRA says to "enter only the property tax paid", and if the owner of the park does not break down the property tax on the lot and there is no MPAC assessment for it, "It would be reasonable to take 20% of the fees and add that amount to any property tax paid on the mobile home or land-lease home."

Ontario's automatic rent reductions can also apply to mobile home parks and land lease communities. The Landlord and Tenant Board notes the exception: "if the taxes charged for the site are not included in the tenant's rent, then the amount of rent the tenant pays to the landlord is not affected by a reduction in taxes. In this case the automatic rent reduction would not apply."