Have your property and school tax bills shot through the roof lately? Chances are they have: with property values rising steadily, many homeowners are in this situation.
You should know, however, that it’s possible to appeal your property assessment if you believe it doesn’t reflect the true value of your home. Before explaining how, let’s clarify what the assessment actually is.
Property assessment in brief
A municipality’s valuation roll contains information about every property located within its territory, including its real value.
That “real value” is the property’s exchange value on an open, competitive market—in other words, the price it will most likely fetch in a mutual-consent sale.
That value then serves as the basis for establishing the municipal property tax and school tax amounts. Those amounts are calculated by multiplying the assessed value by the tax rates in effect. The property assessment amount therefore has a direct impact on the amount of your tax bill.
The taxpayer, however, may request a review—if certain conditions are met.
Valid reasons for requesting a review
Simply disagreeing with the assessed property value isn’t enough to submit a request for review: you must be able to prove it is inaccurate.
That means proving that it would have been impossible to obtain the assessed amount in a sale subject to the real-estate market conditions that prevailed 18 months before the valuation roll came into force (that date is always January 1).
Here are examples of grounds for appeal that may be invoked:
- Defects with the property (e.g., breakage, construction defects);
- Nuisances (e.g., noise, pollution, flooding);
- Other factors based on sales of comparable properties, high expenses, etc.
Getting help from a chartered appraiser experienced with this type of request is a very important part of the review process. The information you’ll need—for example, details of transactions for comparable properties in your neighbourhood during the period concerned—can be difficult to assemble. The appraiser’s report will therefore be an invaluable document in support of your review request.
The review request process
Once the process is started, the formalities specific to each body must be complied with for the request to be eligible.
The first step is an application to the municipal organization responsible for assessment (city, municipality, or regional county municipality, commonly known as an MRC):
- Use the form provided by the appropriate authority to prepare the request for review.
- On the form, list the reasons why you are contesting the assessed value; if requested, attach the chartered appraiser’s report.
- Submit the form in person or by registered mail to the required location; if applicable, pay the fee required for review of the assessment in question.
Note: Be sure to file your request no later than April 30 following the date the valuation roll came into force.
After reviewing the file, the municipal assessor will provide a written response (modifying or maintaining the real value) no later than September 1.
He or she can, however, extend this deadline,
- to the following November 1;
- or to the following April 1, with the consent of the municipality concerned.
If you aren’t satisfied with the municipal response, you can take your appeal to a second body, the Tribunal administratif du Québec. The tribunal allows citizens who disagree with decisions handed down by certain authorities (e.g., a municipality) to obtain a reassessment of their case.
This second procedure involves filing a written request with the Secretariat of the Tribunal administratif du Québec or with a registry of the Small Claims Division of the Court of Quebec. You can also send the request by registered mail or fax to any of the points of contact of the Tribunal.
- Payment of the prescribed fee (based on the value of the property and the grounds invoked) must be included when filing the request.
- The request for reassessment must invoke the same grounds as the earlier request. The request must be submitted no later than 60 days after the date of the municipal assessor’s response (the deadline will be earlier if the municipal response did not arrive within the prescribed time limit).
- A decision will be rendered after the parties have been heard.
Third recourse: As a last resort, with the permission of a judge, it’s possible to appeal your case before the Civil Division of the Court of Quebec, within 30 days following the decision from the Tribunal administratif du Québec.
For the second and third procedures, it is practically indispensable that you be accompanied by an expert, such as a chartered appraiser, or be represented by a real-estate lawyer, to maximize the chances that the tribunal or court will find in your favour.
Detailed calculations to perform
Before challenging your property assessment, though, the smart thing to do is make sure the reward will be worth the risk. How much of a reduction in your municipal and school tax rate can you expect? Will it be 5, 10 or 15%? And how much would that decrease work out to in real dollars?
Also, how much will the review process cost you? There will most likely be fees for the appraiser’s report, charges for filing the requests at each stage, other professional fees, and so on.
Once you’ve thought it all through, you’ll be able to judge whether a review is worth it in your situation. Every case is unique!
Our thanks to Élaine Saint-Denis, President of Bourassa, Jodoin Real Estate Appraisers, a CAA-Quebec Approved Supplier, for her contribution to this instalment of Tips & Tricks.