Proposed Full Tax Deferral Program

Size: px

Start display at page:

Download "Proposed Full Tax Deferral Program"

Hortense Davis
3 years ago
Views:

1 Tax Relief for Low ncome Seniors (FN-20-15) Administration & Finance Committee April 22, 2015 Mark Scinocca, Commissioner of Finance and Regional Treasurer

2 Background xisting tax increase deferral program is a mandated program for low income seniors and persons with disabilities The Town of Oakville Council s resolution in May 2013 requested Halton Region to consider enacting a full tax deferral program Staff indicated the tax deferral policy would be reviewed as part of 2015 Tax Policy. 2

resolution in May 2013 requested Halton Region to consider enacting a full tax

3 Program Review Objective Helping seniors remain in their homes Focus of Review Number of financial programs available Public (Provincial / Municipal) and Private ligibility Awareness of programs 3

4 Demographics for Seniors 4

5 Programs Supporting Seniors 5

6 Seniors ncome & Financial Support Seniors' ncome and Financial Support (as of 2014) Net ncome Level from other sources (after tax) Guaranteed ncome Supplement (GS) Old Age Security (OAS) & Canada Pension Plan (CPP) Guaranteed Annual ncome System (GANS) $140,000 $120,000 $116,300 $100,000 $91,300 Total ncome $80,000 $60,000 $40,000 $26,500 $41,300 $66,300 $20,000 $0 $0 $25,000 $50,000 $75,000 $100,000 Net ncome Net ncome Net ncome Net ncome Net ncome Ontario Renovates Ontario Trillium Benefit Senior Homeowners' Property Tax Grant Renovation Tax Credit Property Tax xemption Tax Deferral (s.319) Tax Rebate/Credit (s.365) *= ligible, = neligible 6

$60,000 $40,000 $26,500 $41,300 $66,300 $20,000 $0 $0 $25,000 $50,000 $75,000 $100,000 Net ncome Net ncome Net ncome Net ncome Net ncome Ontario Renovates Ontario

7 Halton s Current Programs Mandatory tax increase deferral under Section 319 for low income seniors and disabled Discretionary tax rebate programs under Section 365 in Burlington, Halton Hills and Oakville, with cost sharing by the Region Program take up of nearly 800 for tax rebate and only a few for tax increase deferral 7

365 in Burlington, Halton Hills and Oakville, with cost sharing by the Region

8 Other Cities/Regions The Region of Peel and the City of Belleville: tax rebate for low income seniors and disabled homeowners (instead of tax increase deferral) The City of Kingston: tax grant to seniors receiving GS, and tax deferral of the lower of 50% of total annual tax or $1,000 for low income seniors receiving GS and persons with disabilities The City of Toronto: tax increase cancellation or deferral depending on criteria The City of Ottawa: full tax deferral for low income senior and disabled homeowners until such time as they no longer qualify for the program (in addition to the tax increase deferral) 8

seniors receiving GS and persons with disabilities The City of Toronto: tax increase cancellation or deferral depending on criteria The City of Ottawa:

9 Consultation Consulted with various stakeholders Lack of awareness of existing programs among seniors Need awareness about full range of programs Need a convenient access to the program, such as one-stop shopping and resources where seniors could obtain all financial assistance information from one source and complete application Current deferral program relates to tax increases only the increase is a small amount and not worth the effort Creating a lien can be an issue Need for assistance may increase due to forced retirements, lack of pensions and increased debt 9

information from one source and complete application Current deferral program relates to tax increases only the increase is a small amount and

10 Proposed Full Tax Deferral Program Propose a full tax deferral program similar to Ottawa to be implemented for 2016 Regional program with option for Local Municipalities to participate Participating Local Municipalities to administer program Region to provide grants to reduce interest cost to the applicants Region will pay a grant for the difference between mandated interest/penalty and policy interest rate charged for deferral, for example: 10% grant = 15% mandatory 5% policy interest 10

program Region to provide grants to reduce interest cost to the applicants Region will pay a grant for the difference

11 Key Principles for Full Tax Deferral ligible age - 65 (all registered owners) ncome threshold - $43,200 All owners of a property must apply and qualify Principal residence with property classed as residential Minimum five years residing in community Total deferral value not to exceed 50% of assessed value of a property Mutually exclusive to S.319 tax increase deferral and to the Local rebate programs Requires annual renewal process Applicant pays initial applications fees and renewal fees, and legal costs Require a registered lien on title 11

not to exceed 50% of assessed value of a property Mutually exclusive to S.

12 Key Principles for Full Tax Deferral (cont d) Region provides grant to individual tax accounts annually at year-end: the difference between the mandated15% and a policy interest rate (e.g. 5%) Program administered by participating municipalities based on uniform application process Deferred taxes to be repaid when applicant no longer meets eligibility criteria; property sold or transferred; death of applicant, unless survived by a qualified spouse; deferral amount exceeds percent limit of assessed value Locals to receive full tax amount outstanding including cumulated interest (e.g. 5%) at repayment; depend on level of Regional grant. 12

5%) Program administered by participating municipalities based on uniform application process Deferred taxes to be repaid when applicant no longer meets

13 Communication Plan Key to successfully implementing the relief program will be to design an effective awareness campaign A communication plan needs to be developed, working towards a one-window approach where seniors can access all of the Regional support programs helping seniors remain in their homes Communication plan would include a range of activities with enhanced and targeted messaging to the seniors through print, on-line, social media, and website with interactive steps to guide eligibility and available funding Staff will work with partner agencies and the Local Municipalities to ensure a broad reach of information across the Region 13

include a range of activities with enhanced and targeted messaging to the seniors through print, on-line, social media, 3-1-1 and website with interactive steps to

14 Next Steps Upon Council approval, the implementation of the program would require a significant coordination between Regional and Local Municipal staff to finalize the program criteria and to develop an application process and applicable by-law Grant program for interest component will be incorporated in 2016 Budget annually estimated in the range of $100,000 to $150,000 14

criteria and to develop an application process and applicable by-law Grant program for

The Corporation of the TOWN OF MILTON

The Corporation of the TOWN OF MILTON ABBREVIATED COUNCILLOR RESPONSE REPORT Report to: Chair and Members of the Administration and Planning Committee From: Linda Leeds, Director, Corporate Services & Treasurer Date: November 12, 2007 Report