Your first stop for self-help is a review of our FAQs. Take a look at the ever increasing collection of questions asked by Ontario’s small-scale landlords as well as the actual answers provided by Landlord’s Self-Help Centre.
If your tenant is behind in the rent, you cannot do anything that affects the supply of utilities, as this would be an offence under the Residential Tenancies Act, and would allow the tenant to take you to the Landlord and Tenant Board for a rent abatement.
You should serve the N4 in the proper manner, giving 14 days for the tenant to pay or move out, and then file an L1 application with the Board on or after the 15th day.
You cannot charge or ask extra money for the extra utility usage since this would be a unilateral change to the contract that you entered into with the tenant. You are only allowed to increase the rent by the guideline amount once every 12 months and you are also required to serving a 90 days notice N1.
The same goes with the extra people living or visiting, unless there is overcrowding according to the local municipality, tenants are free to have as many people visiting/living with them as they please.
Currently the Residential Tenancies Act does not have any provisions about this particular issue, our understanding is that these costs cannot be passed on to existing tenants. However, for a new tenancy if the tenants will be paying for these charges it must be specifically addressed in the lease agreement as a separate charge.
You are correct in assuming that you do not have any remedy available at present to deal with a spike in utility increases. We recommend that you ask the tenant for the allowable rental guideline increase every year, using the proper Landlord and Tenant Board notice, as a way to help deal with some of the increased costs.
As of September 1, 2021, landlords can file an application for failure to pay utility costs with the LTB. For more information on the September 1 amendments to the Residential Tenancies Act visit https://tribunalsontario.ca/ltb/operational-updates/#sept1. The prescribed form is available at http://tribunalsontario.ca/ltb/forms/.
If the tenants agree to pay an extra charge for utilities that they were not paying for previously, the law states that the rent will then have to be adjusted and reduced to compensate for the removal of services that were previously included in the rent; otherwise it would still be considered an illegal rent increase. There is no particular form to be used in this case but it is recommended to have a written agreement that you can draft up yourself.
If you have an agreement where the water or other utilities are included in the rent, then there isn’t a way you can change it at this point. Whether the water is provided to you at a flat rate or on a metered basis, you cannot reduce or remove the service without their permission. If the tenants do agree to take on the responsibility of paying their own water, you would have to reduce the rent to compensate (using the average monthly cost of the reduced service) for the removal of services that was previously included in the rent.
Since this is a charge for utilities, it would not be considered rent and you cannot serve the arrears of rent notice. In this case, your recourse would be to serve an N5 notice to evict the tenant for interfering with your lawful right. As of September 1, 2021, landlords can file an application to recover utility costs from the tenant. The prescribed forms are available on the LTB website http://tribunalsontario.ca/ltb/forms/.
The city does not change the water bill to the tenant’s name, it remains in the owner’s name. Therefore when the bill is not paid the municipality does not try to collect from the tenant even though your tenancy agreement may state that the tenant is responsible to pay. Typically, the municipality will usually add these arrears to your property tax bill. In order to deal with the unpaid utilities you may serve the tenant with the form N5 based on the reason of interfering with the landlord’s lawful rights, privileges or interests. The N5 can be given only if you’re seeking termination of the tenancy.
As of September 1, 2021, landlords can file an application to claim for compensation for expenses they have incurred as a result of the tenant’s failure to pay utilities. The prescribed form is available on the LTB website, at http://tribunalsontario.ca/ltb/forms/.
You cannot force the tenant to pay the gas bill, and the Landlord and Tenant Board does not acknowledge potential damage as grounds to terminate a tenancy. So, unless the tenant moves out you are faced with the following choices. You can either:
1 – Approach the tenant about agreeing to change the terms of the rental agreement to include gas and possibly hydro in the rent, in exchange for an increase in rent to reflect the average extra charge that you will incur, once the gas bills go into your name;
2 – Speak to the utility provider about making temporary payments to keep the utilities on. This may be difficult due to privacy law restrictions, and they may want the tenant to be involved in any changes.
3 – Switch the bill to your name anyway, and file an application with the LTB. As of September 1, 2021, landlords can file an application for failure to comply with utility costs with the LTB. The prescribed form is available on the LTB website at http://tribunalsontario.ca/ltb/forms/.
Either of these scenarios will hopefully avoid a potential situation involving burst pipes, flood, insurance claims and so forth. Otherwise, the tenant may agree to vacate very soon, and if so, you should try to get a termination agreement signed (From N11). All the forms are available from the Landlord and Tenant Board website – http://tribunalsontario.ca/ltb/forms/.
If this tenant has never paid for hydro, legally the tenant does not have to start paying now unless he agrees to it. However if he does agree to it, you will have to reduce his rent because he would now be paying for a service that was previously included in the rent.
As of September 1, 2021, landlords can file an application for the tenants failure to comply with the utility costs with the LTB within one year from the date the tenant is no longer in possession of the rental unit. The tenant must have moved out of the rental unit on or after September 1, 2021. However, in order to file this application with the LTB, you will have to find out their new residential address to be able to serve them. The prescribed form is available on the LTB at http://tribunalsontario.ca/ltb/forms/.
If the tenant agreed to pay for the utility bill including the rental for the hot water tank then the tenant is responsible for the entire utility bill unless otherwise specified in the tenancy agreement. You can give your tenant a N4 Notice for Non-Payment of Rent if he/she has deducted any amount from the rent and the Landlord and Tenant Board can make a decision on the issue.
We do not generally recommend involving the new tenant at this point, because it is not really their problem. Since the contract with the new tenants begins on January 1st, you can only follow through on your contract if you have clear possession of the unit (for example, if the old tenant returns the keys) so that they can move in on the date agreed to. If you do not have possession and the new tenants do agree to bring the move-in date forward, then you can put the account in their name WITH THEIR CONSENT. Otherwise, I would say that you may have to temporarily be the account holder.
Pay the bill to avoid any further issues with the utility company. As of September 1, 2021, landlords can file an application for failure to comply with the utility costs with the LTB within one year from the date the tenant is no longer in possession of the rental unit. The tenant must have moved out of the rental unit on or after September 1, 2021. The prescribed form is available on the LTB website at http://tribunalsontario.ca/ltb/forms/.
We are not aware of any clear and definitive case law on the issue of the responsibility of parties when it comes to the providing, maintenance of and payment for rental hot water tanks. We are not sure if your own municipality has property standards that require the property owner to provide or maintain appliances like hot water tanks (most do not). Section 20 of the Residential Tenancies Act requires that the landlord maintain the premises and comply with all municipal health, safety, housing, and maintenance standards. So if there are no municipal restrictions on the landlord, then a properly worded lease may be a solid foundation for your argument that the tenant should pay you for what they contracted to, even if you cannot make them transfer the account or payment into their name. If they refuse to switch or pay you, and the amounts owing are significant enough to make it worth your while, effective September 1, 2021 you could file an application with the LTB for unpaid utilities. The tenant will likely argue “implied use,” meaning that you failed to raise the matter soon enough, and have therefore accepted the current “arrangement” over time.
As of September 1, 2021, landlords can file an application for failure to comply with utility costs with the LTB up to one year after the tenant vacates the rental unit. The tenant must have moved out of the rental unit on or after September 1, 2021. Forms are available at https://tribunalsontario.ca/ltb/forms/
The Residential Tenancies Act states that the landlord is responsible for “vital services” which are defined as hot or cold water, fuel, electricity, gas and heat unless the tenant expressly agrees to “obtain and maintain” the vital services. In order to have the tenant pay for the rental of the hot water tank the lease agreement should be specific and state that “the tenant expressly agrees to obtain and maintain all vital services including heat, electricity, water, hot water and rental of hot water tank”.
Requiring the tenant to pay additional costs at year end is not a reasonable arrangement. There are often problems related to collecting the difference later on. Your rental agreement would have to be specific and describe what is considered additional costs.
As of September 1, 2021, landlords can file an application for failure to pay utility costs with the LTB. For more information on the September 1 amendments to the Residential Tenancies Act visit https://tribunalsontario.ca/ltb/operational-updates/#sept1.
If you already have a lease that is all inclusive there isn’t a way you can change it at this point unless the tenants agree, in writing. However, even if they do agree you would then have to reduce the rent to compensate for the removal of services that were previously included in the rent. You’re allowed to increase the rent once every twelve months, as long as the proper guidelines are followed.
Section 125 of the Residential Tenancies Act only allows such changes by agreement, and then requires the rent to be reduced by a prescribed amount if the parties both agree to the change. Usually this means that the rent will be reduced by the average actual cost to the landlord. So if the water costs $600 per year on average, then the monthly rent would be reduced by $50 – since the tenant will have to likely pay this amount, separate from their rent, to the utility company or provider. Decrease in services, etc. “25. A landlord shall decrease the rent charged to a tenant for a rental unit as prescribed if the landlord and the tenant agree that the landlord will cease to provide anything referred to in subsection 123 (1) with respect to the tenant’s occupancy of the rental unit. 2006, c. 17, s. 125.” Section 125 deals with parking or a list of 12 other services or facilities, namely: 1. Cable television. 2. Satellite television. 3. An air conditioner. 4. Extra electricity for an air conditioner. 5. Extra electricity for a washer or dryer in the rental unit. 6. Blockheater plug-ins. 7. Lockers or other storage space. 8. Heat. 9. Electricity. 10. Water or sewage services, excluding capital work. 11. Floor space. 12. Property taxes with respect to a site for a mobile home or a land lease home. O. Reg. 516/06, s. 16 (1). We realize this is not the answer you were expecting, but we hope it has been helpful.
In this situation, you don’t really have too many options. Since the utilities are already included in the rent, there is no legal way to have the tenants pay for the excess costs of the hydro/water. The only way that would be permissible is if the tenants agree to start paying for the utilities. However, even if they do agree to start paying for the utilities now, you would have to reduce the rent to compensate for the removal of a service that was previously included in the rent.
The Apportionment of Utility Costs Section 13 of Ont. Regulation 394/10 describes the method that should be used to calculate a tenant’s portion of utility cost. This section applies to buildings containing not more than six rental units. The following is a link to the regulations
https://www.ontario.ca/laws/regulation/100394#BK14
If you already have an agreement in place where the utilities are included in the rent you cannot change it at this point unless the tenant agrees to it. However, even if the tenant did agree to pay a portion of the utilities you will have to reduce the rent to compensate for the removal of this service that was previously included in the rent.
Unfortunately we do not know of a way that you can protect yourself should the tenant decide to remove their name from the account, other than requesting that Toronto Hydro notify you if this happens.
If you have an agreement where the utilities are included in the rent there isn’t a way you can change it unless the tenants agree, in writing. However, even if they do agree to start paying for the utilities you would have to reduce the rent to compensate for the removal of services that were previously included in the rent. The only other option you have is to increase their rent by the rent increase guideline if they have already been there for twelve months, and you must give them 90 days’ notice using the prescribed form which is Form N1.
A landlord cannot charge extra when a tenant acquires an air conditioner unless it has been clearly specified in a written tenancy agreement that the tenant will pay extra if they chose to have an air conditioner.
If the utility accounts are in the tenant’s name and they default the landlord will not be held responsible. The utility companies have to collect from the person who is on the account.