Alberta property assessment appeals and tax updates

Property tax is the most significant variable operating expenses for commercial real estate owners and occupants. And as real estate values continue to rise, property taxes rise in synchrony. It is more important than ever that your property assessment is fair and equitable.

By taking a proactive approach to property tax management, many owners and investors can leverage tax planning more strategically to realize operational and transactional efficiencies and unlock greater asset value.

Follow this page to stay up-to-date with property assessment and tax deadlines for your assets in Alberta.

City of Calgary property tax assessment appeals

Owners are now receiving their annual property assessment notices from the City of Calgary.

2022 assessments are based on a valuation date of July 1, 2021, making it the second year that should reflect the impacts of the COVID-19 pandemic. As such, it is more critical than ever that your assessment(s) be reviewed for accuracy to ensure you and your tenants are not paying more than what is fair and equitable.

The Customer Review Period is now underway and will run for 60 days until the appeal deadline, March 14th. This period allows property owners the opportunity to examine their assessments, collect advice from experts and, where necessary, appeal their assessments.

Reminder: You can file a formal complaint against your property’s assessed market value, but not against your property tax bill.

Important dates

• Assessment notices released, January 5, 2022

• Customer Review Period: January 5 – March 14, 2022

• Appeal deadline: March 14, 2022

• Property tax notices released: May 2022

• Calgary property taxes due June 30, 2022

Tax rate increase in Calgary

For the 2022 assessment and taxation year, the total non-residential assessment base continues to erode, creating upward pressure on the tax rate. For the second consecutive year, we are projecting an estimated 7.5% increase to the tax (mill) rate for 2022.

This means that many of the decreases that owners see in their assessed values may be offset by an increase to the tax rate. In some instances, ratepayers will see moderate to material increases to their 2022 property taxes.

Sustained COVID effects in the market

The hospitality sector continues to see the largest declines to assessed values, followed by the office sector which has seen another billion dollar decrease in assessed value in the Downtown core.

The industrial and multi-family sectors remain stable and will generally see higher valuations, and with the compound effect of an increased tax rate, will be likely to incur double-digit increases in property taxes.

City of Edmonton property tax assessment appeals

2022 assessment values will reflect the market as of July 1, 2021, 16 months after COVID-19 started to seriously impact Edmonton’s commercial real estate and deep into the oil price collapse. The negative effects on property values have been widespread and range from moderate to extreme, depending on asset class.

Current challenges in the city of Edmonton include:

• Edmonton city council approved a 1.9% property tax increase for 2022

• Edmonton’s commercial real estate market faced challenges in the Alberta economic downturn and was exacerbated by the pandemic

• Assessed values should be reviewed as they are often too high relative to the changing market and the 2022 commercial tax rate will be higher this year

As the current economic challenges continue, property owners need to ensure they and their tenants are only paying a fair share of property tax. Reminder: You can file a formal complaint against your property’s assessed market value, but not against your property tax bill.

Important dates

• Assessment notices mailed: January 14, 2022

• Customer review period: January 14 – March 23, 2022

• Appeal deadline: March 23, 2022

• Property tax notices released: May 2022

• Edmonton property taxes due: June 30, 2022

Frequently asked questions

Should I appeal my property assessment?

In Alberta, most commercial property values are calculated based on market value. However, with COVID-19 and other market variables, the value of specific asset classes has increased significantly, leaving property owners to pay higher property taxes.

If you feel your property tax assessment is inaccurate, you can engage Altus Group to act on your behalf and file an appeal with the Assessment Review Board. A successful appeal can result in you receiving a fair and equitable property assessment, saving you thousands in reduced property taxes.

How does a property tax assessment work?

Both the City of Calgary and the City of Edmonton determine the market value of your properties based on a valuation date of July 1 2021. Meanwhile, the Government of Alberta and Municipal governments (taxing authorities) determine the property tax rates for each of the nine property classes and apply the applicable tax rate in early spring.

The government then applies this rate to the assessed value of properties and the City sends property owners a property tax notice and collects on behalf of the Province of Alberta.

How does the assessment appeal process work?

The first level of appeal is to the Composite Assessment Review Board (CARB). All complaints (appeals) to CARB must be filed directly with Assessment Review Board by the deadline stated on your assessment notice. If you disagree with the decision, you may file an application for judicial review with the Alberta Court of Queen’s Bench. This review will determine if the Assessment Review Board acted in a fair, reasonable, and lawful manner.

How can I reduce my property tax?

Property assessment appeals are important in ensuring that a property’s tax burden is as low as possible. Among the things we look at to determine opportunities for assessment reductions and property tax savings:

• A full and thorough review of the assessor’s records and working papers

• Review and analysis of financial statements for the property, both current and historic (trending)

• Focus on both the income and expense sides

• Research and review of properties within the competitive set to ensure equity of the assessment and taxation burden

• Change in use of the property, in whole or in part

How can Altus Group help with my property assessment appeal?

Our property tax teams in Calgary and Edmonton will review your property assessment thoroughly and assess the following:

• Was the correct assessment methodology applied? Note: there are different ways to evaluate the value of a property, such as income approach (office buildings, retail and industrial properties), direct comparison approach (residential), and cost approach (special purpose)

• Is the assessment correct and equitable?

• Was the appropriate interest valued?

• Does the value include business enterprise or intangible value?

• Are non-assessable assets included in the value?

• We will work with you to gather all your supporting evidence and prepare the required documentation to present at your Assessment Review Board hearing

Why choose Altus Group?

If you are an owner of commercial property in Alberta and pay over $20,000 in property taxes annually, Altus Group can help you save thousands in reduced property taxes.

As a Canadian-owned company in operation for over 40 years, our national practice provides access to a wealth of information and market data on comparable properties across the country. Our property tax consultants use this data, combined with local expertise, to efficiently manage your tax liabilities and maximize potential tax savings.