The honest answer: Toronto has the LOWEST residential property tax rate of any major Canadian city (~0.71% as of 2025) — but the highest property values. 905 municipalities run 0.8-1.3%. The net annual property tax bill is often similar between a $1.2M Toronto home and a $900K Mississauga home — but the underlying dynamics are very different.
Toronto home values: check a free, instant estimate for your home using our Toronto home value calculator.
2025/2026 residential property tax rates
| Municipality | Residential tax rate | Annual tax on $1M MPAC value |
|---|---|---|
| City of Toronto | ~0.71% | $7,100 |
| Mississauga | ~0.82% | $8,200 |
| Markham | ~0.85% | $8,500 |
| Vaughan | ~0.81% | $8,100 |
| Oakville | ~0.85% | $8,500 |
| Brampton | ~1.06% | $10,600 |
| Burlington | ~0.92% | $9,200 |
| Hamilton | ~1.30% | $13,000 |
The MPAC gap — why “tax rate × home value” doesn’t match your actual bill
Property taxes are calculated as MPAC assessed value × tax rate. MPAC values are typically 15-30% below actual market value in 2026.
Example: A Toronto home with $1.5M market value typically has an MPAC assessment of $1.1M-$1.25M. At Toronto’s 0.71% rate:
- Tax on MPAC value ($1.15M): ~$8,200/year
- Tax on market value ($1.5M): would be ~$10,700/year (but you don’t actually pay this)
The gap exists because MPAC assessments haven’t been fully re-valued since 2016 in Ontario (the planned 2020 re-assessment was deferred).
Comparison: $1.2M Toronto home vs $900K Mississauga home
| Item | Toronto $1.2M | Mississauga $900K |
|---|---|---|
| Market value | $1,200,000 | $900,000 |
| MPAC estimated (~82% of market) | $984,000 | $738,000 |
| Tax rate | 0.71% | 0.82% |
| Annual property tax | ~$6,990 | ~$6,050 |
How to dispute your MPAC assessment
If your MPAC assessment looks higher than 70-80% of current market value, you may be over-assessed. File a Request for Reconsideration (free, online) with MPAC. Provide evidence:
- Recent sales of comparable homes
- Independent appraisal (paid; $400-$600 — only if amount at stake justifies)
- Specific property issues (deferred maintenance, layout problems)
Successful RfRs typically reduce assessed value by 5-15%. On a $1M Toronto home, that’s $400-$1,500/year in tax savings.
Property tax considerations for buyers
- Don’t fixate on rates — total annual tax depends on assessed value × rate. The product matters.
- Toronto’s lower rate doesn’t make up for the higher LTT (see our LTT guide) on purchase day.
- Brampton + Hamilton have higher rates — factor into monthly carrying cost calculations.
- Some condos have higher tax-equivalent costs due to high condo fees + property tax combined.
Annual carrying cost summary by city
For a typical detached family home (mid-market for each city):
- Toronto $1.4M: Property tax ~$8,000 + insurance ~$1,500 = ~$9,500/year
- Mississauga $1.1M: Property tax ~$7,400 + insurance ~$1,300 = ~$8,700/year
- Markham $1.4M: Property tax ~$9,800 + insurance ~$1,500 = ~$11,300/year
- Vaughan $1.5M: Property tax ~$10,000 + insurance ~$1,600 = ~$11,600/year
- Brampton $1.0M: Property tax ~$8,700 + insurance ~$1,300 = ~$10,000/year
- Hamilton $850K: Property tax ~$9,000 + insurance ~$1,200 = ~$10,200/year
Annual carrying cost differences across Ontario are smaller than people expect once you factor in market value differences.
Frequently asked questions
Why does Toronto have the lowest property tax rate?
Toronto’s tax base is enormous (high property values, large population) and includes commercial/industrial properties at higher rates that subsidize residential. Plus the city has historically chosen lower property taxes funded partly by other revenue sources (LTT, fees, transit fares). Net effect: lowest residential rate in Ontario but balanced by the Toronto Municipal LTT on purchase.
How is property tax calculated in Ontario?
MPAC assesses your property’s value. Your municipality sets a tax rate (mill rate). Annual property tax = MPAC value × municipal rate. For a $1.2M Toronto market-value home: MPAC value ~$984K × 0.71% Toronto rate = ~$7,000/year.
Can I dispute my MPAC assessment?
Yes. File a Request for Reconsideration with MPAC (free, online). Provide recent comparable sales or an appraisal. Successful RfRs reduce assessed value 5-15%. Higher-level appeals (Assessment Review Board) involve fees and are worth pursuing only for substantial expected savings.
Are property taxes deductible in Canada?
Not for principal residences. Property taxes on investment/rental properties are deductible against rental income. Property taxes on principal residences are paid from after-tax income.
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 | Alex GoodmanSales Representative · RE/MAX Your Community Realty, Brokerage Alex Goodman is a Sales Representative with RE/MAX Your Community Realty, Brokerage, serving the Greater Toronto Area. He specializes in residential sales across Ontario — luxury, first-time buyer, and downsizing transactions — and maintains InstantCalculator.ca as a free public resource for Ontario homeowners researching their property value. |