Are property taxes and assessment the same thing?
Property taxation is one of the most prominent ways municipalities are able to raise revenue to provide services back to their rate payers. A property’s assessment is a part of the formula which determines the property taxes a property will be levied within a municipality. The assessment relates to the value of a particular piece of property. This value is then multiplied against the applicable tax rate in the municipality to result in the amount of property tax.
How is the assessment determined?
Assessment is heavily legislated. The overarching legislation determines how the assessment on each property will be determined. Most properties within Alberta will be valued at market value. Legislation directs assessment to be completed using “mass appraisal”. This method involves the process of preparing assessments for a group of properties using standard methods and common data, allowing for statistical testing. Assessors analyze sales information to determine fair & equitable market value for an entire grouping of properties within the municipality. The remaining properties, such as farm land or machinery and equipment will follow regulated guidelines for value.
What does the assessment reflect?
The assessment on most properties is an estimation of market value. For most property within Alberta, this means:
Municipal Government Act s.1(1)(n) “market value” means the amount that a property, as defined in section 284(1)(r), might be expected to realize if it is sold on the open market by a willing seller to a willing buyer
Legislation also states that the assessment must reflect value as of July 1st of the prior year, as the property stood on December 31 of the prior year. For example, the assessment received in 2019 reflects a value as of July 1, 2018 and condition as of December 31, 2018.
What do I do if I disagree with my assessment?
First thing we recommend doing is speaking with your assessor. The assessor can review the information we have on record for the property to determine if there are any errors or anomalies. Information can be exchanged on the property ensuring the most accurate data is used in the valuation process. We hope that the conversation will be informative on both side with a positive understanding of the valuation.
Unfortunately, it may not always be possible for both sides to come to a resolution. As a property owner, the next step would be to file an assessment complaint with the Assessment Review Board. The complaint will be heard by an independent panel to determine whether the assessment is to be altered or confirmed.
An assessor is requesting information about my property, do I have to provide it?
The assessment is extensively data driven. We ask participation of all property owner to provide information to us in order for us to prepare the most accurate assessment for that property. The Municipal Government Act (MGA) section 295 allows assessors to request information which allows them to carry out their duties under the MGA. Information may be requested during on-site inspection, direct contact with the owner or through Request for Information (RFI) packages. RFI packages are sent to individual property owners in order to survey for various data elements. Most often, RFI’s will be sent to non-residential property owners.
It is important to note, if a property owner is non-compliant with these requests, they may lose their ability to file a complaint on their assessment under MGA s.295(4).
Are physical property inspections typical?
Yes, physical inspections of property occur on a regular basis throughout municipalities. These inspections usually occur in 3 different ways. Rotational inspections occur on a regular basis. These inspection involve a specific area within a municipality in which every property is reviewed for the information that is on file. Much like an oil change in you car, it is maintenance of the assessment record that keeps the valuation accurate. Annual inspections are conducted each year and include properties that have had a known change or taken out a development permit. These inspections ensure changes are collected and reflected in the assessment. Requested inspections are at the request of a property owner to review their assessment file.
If you have any further questions pertaining to your assessment, or assessment in general, please give us a call. We’ll gladly take the time to answer the questions you have.