Are you calculating your residential property tax change correctly?
When calculating your year-to-year tax change it’s important you use the correct numbers. Two common mistakes include:
- Determining a property tax change by looking at the change in your monthly tax instalment. The change in your Tax Instalment Payment Program (TIPP) instalment in July is not equal to the change in your property tax. Any increased tax responsibility is spread over the last six months of this year. Using your instalment to calculate your yearly change can make your tax increase appear much higher than it is.
- Forgetting to factor in the 2020 Council Approved Rebate. As this comes off what you’re paying, you should subtract it from your 2020 current tax before finding the change amount.
The best way to determine your yearly tax change is to compare your current and last year's tax bill. To help homeowners calculate their percentage change correctly, The City launched a new online tax change calculator.
How your home's assessments and Calgary's typical market change might impact your tax change
In late May, The City of Calgary mailed out property tax bills to over half-million property owners. While The City of Calgary did not increase its budget, the typical Calgary home did see a combined (provincial and municipal) increase of 7.5%. In comparison, many businesses saw a significant decrease of 12.07% to support our local economy.
Many homeowners have wondered why their property tax change isn't equal to 7.5%. It's important to know that provincial and municipal tax changes are one factor that contributes to how your property tax might change. Your share of property tax is also influenced by your property's assessed value and Calgary's typical market change. As a result, residential property owners will see a range of decreases or increases from 7.5 per cent, learn more down below.
In 2020, the typical market change for residential properties is -4%, and non-residential properties were 2%. If the value of your residential property has a change in assessment between 2019 and 2020 of:
- Less than the typical per cent change of -4%: The portion of taxes owed will be less than the 7.5% increase.
- The same as the typical per cent change of -4%: The portion of taxes owed will be approximately the same as the 7.5% increase.
- More than the typical per cent change of -4%: The portion of taxes owed will be more than the 7.5% increase.
Several factors contribute to your assessment, such as the size of your house, renovations, the year it was built, the neighbourhood you live and a few others. All together, they make up the fair market value assessment of your home.