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Property taxes can come in stages

The property tax you pay to the builder can just be the tip of the iceberg.<br />

We purchased a new home from a builder last year and at that time we paid our property tax to the builder. Last week, we received a tax bill from the City for a whopping $2,800 that needs to be paid in the next six weeks. The invoice states it is for supplementary taxes. The builder isn’t answering our calls and we need to know if we should pay this bill?

Typically when you purchase a new home, the tax that is payable and usually remitted by the builder on your behalf is for the value of the land only, as the structure is new and has not been assessed by the municipality. The missing component of your tax bill commences at the time of possession. Therefore, it is highly likely the amount that you paid in taxes was only a portion of the total tax payable.


When the City has finally assessed the value of your new home, they will send out a supplementary tax bill which covers the taxes payable from the first day of ownership up to the present day. You should refer to your paperwork that you received on closing to determine what actually was paid on your behalf by the builder. If indeed the amount was only for the value of the land, you will be required to pay the excess amount.


New home purchasers should be aware that this invoice is pending and save for the eventual payment that will be due and payable, often on short notice.

 
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