Property assessment is the process of assigning a dollar value to a property. Once a property is assessed, this dollar amount is used in a formula to determine how much in taxes an owner needs to pay. In the NWT the responsibility to manage property assessment belongs to MACA with taxation responsibilities handled mainly by the Department of Finance.
Property that needs to be assessed includes:
- improvements to buildings, mobile units, pipelines and works and transmission lines;
- any assessable land in Municipal Taxation Communities and assessable land in communities that make up the General Taxation Area (GTA); and,
- all land and improvements that make up the Hinterland which include things like mines, oil and gas installations and telecommunications infrastructure located outside of community boundaries.
Frequently Asked Questions:
- How can I review my property assessment?
Each year, property owners receive a notice of assessment that summarizes the information about their property that will be included in the annual assessment roll for that taxation year.
All assessed property owners can review their community’s assessment roll to make sure that the information about their property is accurate. The assessment roll for each community is located at the community government’s office.
- How do I understand my property taxes?
The amount of property tax you will have to pay determined by the assessed value of your property. Property taxes are calculated by dividing the assessed value of your property by 1000 and multiplying the answer by the mill rate as follows:
Property Taxes = (Assessment Value ÷ 1000) x Mill Rate
For each GTA community, the Department of Finance sets a mill rate that represents one dollar of tax for every $1000 of assessed value. It is the Department of Finance who sends out tax notices to each assessed property detailing how much in taxes need to be paid for that year.
When a new assessment is done on your property, it does not necessarily mean that you will have to pay more property tax. A lower mill rate might mean that you will pay the same or less tax, even if the assessed value of your property has risen.
- How does property assessment and taxation work in the General Taxation Area (GTA)?
If you do not belong to one of the Municipal Taxation Communities, then your community is part of the General Taxation Area. The Assessment Services Unit conducts property assessments for assessable land, improvements, and Hinterland areas in and around your community. Once a value for a property is determined, the Department of Finance assigns a mill rate for your community. From the mill rate and assessed value of the property, a property tax is determined and must be paid to the Government of the Northwest Territories. Once tax revenues are gathered and processed, funding is returned to communities in the GTA.
- How is property assessed?
A certified Assessor from the Assessment Services Unit determines the value of each property by taking into account the land and the improvements on it. Assessors assign value to property by following the legal guidelines in the Property Assessment and Taxation Act, the Property Assessment Regulations, and the Property Class Regulations. Following the same guidelines makes sure that all assessments in the NWT are consistent and fair.
- What are Municipal Taxation Communities?
Municipal Taxation Communities are communities that collect their own municipal taxes; they are the Municipal Taxation Authority for their given town or city etc. Municipal Taxation Communities in the NWT are:
- Norman Wells;
- Fort Simpson;
- Hay River; and
- Fort Smith.
- What if I don’t agree with my assessment?
If there is a mistake on your notice of assessment, or you do not agree with the assessed value of your property, you can appeal the assessment to the Board of Revision. All appeals must be made within 45 days from the mailing date of the notice of assessment. Look at the back of your notice of assessment for more information on how to appeal your assessment, or contact MACA (LINK: contact info for Prop Asses & Tax).
- What is an assessment roll?
An assessment roll is a list of all assessable property in a given community. Each community’s assessment roll includes the following information for each property or lot:
- the ratepayer’s name and address;
- a legal description of the property;
- the assessed value of the land and any improvements;
- an account number;
- a property classification;
- who owns tenure to the land;
- any taxable and exempt status; and
- an owners code.
- What is the difference between annual assessment and general assessment?
Annual assessments reflect any changes in property value for that year. Adding or removing improvements may increase or decrease a property’s value, and the annual assessment reflects this.
A general assessment looks at more than improvements to properties, and must happen within 10 years of the previous general assessment. A general assessment takes into account factors like inflation, deflation, and other factors that can change the value of a property over time that are not necessarily related to the land or improvements (like a change of zoning etc.). Once a general assessment is complete, new assessed values for all property using that common base year is created, and is the basis on which annual assessments are done.
- What is the value of my property based on?
An assessor assigns value to your property based on the value of the land and based on any improvements on your land.
In the GTA, the value of land is based on development costs which include things like the cost of building new roads and providing services like water, sewer, and electricity to the land in question. TheProperty Assessment Regulations, and the Property Class Regulations outline clear guidelines to determine what the land developments costs are in each region of the NWT.
To determine what value should be given to improvements, a formula is used that assigns a value to the improvement that is equal to two-thirds of the depreciated replacement cost new.f