Conservation and Land Based Taxes
This is a general explanation of how taxes are calculated and how they relate to conservation on your land. Since no one likes to pay more taxes than necessary, new ways to conserve properties while reducing property and transfer taxes are highlighted. TIWLT is willing to work with you to achieve these positive results for conservation purposes.
HOW PROPERTY TAXES ARE CALCULATED
The provincial government determines the value of properties within certain categories (e.g. farm land, residential/farm, commercial, industrial, and others), and reports this total value to a municipality. Taking this value, and applying a formula among the different assessment categories municipalities then determine their tax rates. These rates are then applied to your property value and category to produce your property tax bill.
"Conservation Commitments can Lower Property Taxes"
With new changes to the Assessment Act coming into effect in 1998, there are now several ways that property taxes can be reduced below ordinary rates, especially if you make a commitment towards conservation. These include situations where your land qualifies:
- as conservation, managed forest or farm land;
- for "current use", rather than "current value", assessment;
- under a few other special circumstances.
Formerly, persons with certain conservation, eligible managed forest and eligible farm lands received. partial or full rebates On their taxes. The rebate programs have been discontinued. Now, if your land qualifies, it may be assessed in a category that attracts a lower tax rate annually. To determine if this may be the case, contact the regional assessment office of the Ministry of Finance.
Certain conservation lands are now be exempt from property tax. These lands are the most environmentally important: provincially significant wetlands, provincial Areas of Natural and Scientific Interest (ANSI) and Niagara Escarpment natural zones. Lands owned by non-profit conservation groups, the habitat of endangered species and eligible lands of conservation authorities may receive property tax considerations, assessed on a case by case basis.
Managed forests will be taxed at 25 percent of residential/ farm rates. Under the Managed Forest Tax Incentive Program for the Province of Ontario,
- properties must be 10 acres or larger (or greater than 4 acres for significant woodlands).
- meet minimum standards set for tree density and tree size.
- must contribute to managed forest plan objectives.
Management objectives can include conservation, recreation, wildlife habitat- protection, and timber management. Getting a management plan prepared and reviewed is part of this process. Eligible farm lands will also be taxed at 25 percent of residential/farm rates.
Also, farm and managed forest lands will be assessed at their "current use value" (e.g. farming, recreation), rather than their "current value" which could include a premium for potential development. Other lands may also qualify for this lower current use assessment or tax deferrals, where municipalities agree.
Land meeting these conservation, managed forest and farm land criteria contribute to the health and rural character of our communities. By remaining as open space, they also avoid costly municipal services that can lead to increased taxes. Such tax benefits described here thus recognize the public contributions of private landowners and their low demand for municipal services.