A tax sale is the process followed by a Municipality to recover unpaid property taxes through the sale of the property in arrears. By the time a property is eligible for tax sale the property taxes are at least in their fourth year of arrears.
The Municipal Act 2001, the City of Brampton Property Tax Billing and Collection Policy along with the Ontario Regulation 181/03 (Municipal Tax Sale Rules) regulate the collection procedures performed by the Revenue Division of the City of Brampton for the recovery of property tax arrears and, eventually, the tax sale process.
The City of Brampton registers a Tax Arrears Certificate if any portion of property taxes remains unpaid for three years prior to January 1st of any year.
The registration of a Tax Arrears Certificate indicates that the property will be sold if taxes, penalties, interest and reasonable costs incurred by the City (the cancellation price) are not paid within one year of registration of the certificate. Once a Tax Arrears Certificate has been registered, partial payments cannot be accepted, but upon Council approval an extension agreement may be arranged with the owner prior to the expiry of the one-year period.
The City shall advertise the property for sale for non-payment of taxes if the cancellation price is not paid within one year of registration of the certificate. Advertisements are generally published in the Brampton Guardian for four consecutive weeks, in the Ontario Gazette for one week and on the City web site.
Using forms provided by the Revenue Division, the bid plus a certified cheque for 20% of the tendered amount must be submitted in a properly addressed and sealed envelope by the specified date and time. To be eligible, bids must be at least equal to the advertised minimum tendered amount. The successful purchaser will be required to pay the amount tendered plus accumulated taxes, penalties, interests, reasonable costs incurred by the City during the tax sale process, GST/HST if applicable and the relevant land transfer tax.
The successful purchaser has 14 days to complete the transaction from the day of notification. The deposit is forfeited if the transaction is not completed within the 14 days. Properties sold through the tax sale process are sold without warranties and the Municipality has no obligation to provide vacant possession.