Tax Relief for Low Income Seniors
(FN-20-15)
Administration & Finance Committee
April 22, 2015
Mark Scinocca, Commissioner of
Background
• Existing 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.
Program Review
Objective
• Helping seniors remain in their homes
Focus of Review
• Number of financial programs available
Public (Provincial / Municipal) and Private
• Eligibility
Seniors’ Income & Financial Support
$26,500 $41,300 $66,300 $91,300 $116,300 $0 $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 $140,000 $0 $25,000 $50,000 $75,000 $100,000 T o ta l In com eSeniors' Income and Financial Support (as of 2014)
Net Income Level from other sources (after tax) Old Age Security (OAS) & Canada Pension Plan (CPP) Guaranteed Income Supplement (GIS) Guaranteed Annual Income System (GAINS)
Ontario Renovates Ontario Trillium Benefit Senior Homeowners' Property Tax Grant Renovation Tax Credit Property Tax Exemption Tax Deferral (s.319) Tax Rebate/Credit (s.365) E E I E E I I E E I E E I I I I I E E I I E E E E E E E E E E E E E I
*E= Eligible, I= Ineligible
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
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 GIS, and
– tax deferral of the lower of 50% of total annual tax or $1,000 for low income seniors receiving GIS 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)
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
Proposed Full Tax Deferral Program
• Propose a full tax deferral program similar toOttawa 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:
Key Principles for Full Tax Deferral
• Eligible age - 65 (all registered owners) • Income 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
Key Principles for Full Tax Deferral (cont’d)
• Region provides grant to individual tax accountsannually 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.
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, 3-1-1 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
