What is the property taxation process?
Each year, your municipality’s Administration and Council determine the costs needed to provide services such as fire, police, and ambulance service; snow removal; community and social services; road construction and maintenance and other services. Most of the revenue required is collected by way of property taxation. The municipality is also required to collect school taxes on behalf of the Province and the Separate School Boards. Property owners are notified of their share of municipal and school taxes owing through Assessment and Property Tax Notices mailed yearly. These notices include information on the location or legal description of the property, the assessed value, the taxes owing, the due date, information on how to appeal an assessment, and the penalty(ies) for non-payment of these taxes.
How is property assessed?
In Alberta, residential and most commercial property is assessed using the market value approach. Market value is defined as the price a property might reasonably sell for after adequate time and exposure to an open market when sold by a willing seller to a willing buyer.
Why is the market value approach used?
This method is easy for taxpayers to understand and for assessors to work with. Property owners can easily relate to the value of their property based on estimated sale price; and both owners and assessors can readily check assessments by making comparisons with recent sales and assessments of similar properties in the neighbourhood.
What kind of factors are considered in the assessment?
The assessor will consider the same factors that other real estate specialists use when determining the value of a property. For residential properties, these factors include lot and home size, finished basement, construction quality, location, age, upgrades, number of bathrooms, fireplaces, historical and current sales prices, etc. For multi-family and commercial properties, property owners may be requested to submit rental income and expense information.
Where does the assessor get the information?
Assessors obtain required information through many means including site inspections, building permits and blueprints, sales data from Alberta Registries, and by written request. All assessment information is maintained on a computerized database and assessments are done using international appraisal standards.
How often are properties assessed?
All assessments are updated yearly to reflect changes in local market conditions, but not all properties are inspected. Most municipalities currently have their assessor re-inspect 20% of the properties yearly to recognize any additions, deletions, renovations, etc, all of which may have an effect on the value of the property. Furthermore, all new construction is inspected.
When are the Assessment / Tax notices mailed?
Each municipality must have their assessment and tax notices mailed by July 1 of each year.
Is the assessment the actual current market value of the property?
Not necessarily, the assessment reflects an estimate of the value based on several factors including similar properties which have sold. Also, your 2022 assessment is based upon market conditions as of July 1, 2021. Any changes, increase or decrease, in property values since then will be not reflected on the current assessment.
I paid $350,000 for my property in 2021, will that be my assessment?
Not necessarily, a property’s assessment is determined from a range of probable selling prices, not a specific selling price. For example, the market value range on the above property may have been $325,000 to $375,000 depending on the time of year, exposure to the market, motivation of buyer or seller, similar property sales, etc. The assessor must take all this into consideration when determining a fair assessment.
How do I check my assessment?
To check that your 2022 property assessment is fair in relation to other similar properties in your municipality, you may review the assessment roll at your municipal office. When reviewing the assessment roll, check for the following:
-that the assessment is a reasonable estimate of the market value of the property as of July 1, 2021 (talk to realtors, appraisers or other real estate experts if necessary)
-that the assessment is equitable in relation to other similar properties
What do I do if I feel my assessment is too high (or otherwise incorrect)?
Get in touch with the assessor first. Most concerns can be resolved in this manner. If you are still not satisfied with the assessment, you may file a complaint with the Assessment Review Board. You must complete the standard complaint form (available at the municipal office). Ensure that you provide complete information with the form. The Assessment Review Board cannot hear matters that are not listed on your complaint. There is a often a fee for filing a complaint.
What is the Assessment Review Board?
An Assessment Review Board hears and addresses complaints about assessment. They can only make a decision about the assessment value and not the taxes you pay.
How do I prepare for an ARB hearing?
Your goal is to show proof to the review board that the assessment on your property is not a fair estimate of the value of your property or not fair when compared to other similar properties. You and the assessor are required to exchange information and evidence before the hearing. The following link will help you present your case:
What if I disagree with the decision of the Assessment Review Board?
If you disagree with the decision of the assessment review board, you may make application for leave to appeal to the Court of Queen’s Bench of Alberta on a point of law or jurisdiction.