Managed Forest Tax Incentive Program guide
Information on how to enter and participate in the Managed Forest Tax Incentive Program.
Updated January 2012
© 2012 Queen’s Printer for Ontario
Printed in Ontario
Copies of this publication are available at no charge from your local office of the Ministry of Natural Resources. For bulk orders of this guide, please contact the Managed Forest Tax Incentive Program (MFTIP) listed below. Charges may apply.
Ministry of Natural Resources
Managed Forest Tax Incentive Program
300 Water Street
Peterborough, ON
K9J 8M5
website: ontario.ca/MFTIP
MFTIP@ontario.ca
Toll Free:
Telephone orders and inquiries about Ministry of Natural Resources programs should be directed to the Natural Resources Information Centre:
On peut obtenir un exemplaire gratuit de la présente publication à l’adresse ci-dessus.
Find the Ministry of Natural Resources online.
Note: Applications for the MFTIP must include a Managed Forest Plan. The planning framework and forms for preparing a plan are found in A Guide to Stewardship Planning for Natural Areas. You can request a copy from your local Ministry of Natural Resources office or the MFTIP Administrator. Contact information is found above.
51046
(15k P.R., 01 01 12)
ISBN: 0-7794-9417-2 REV
What’s new in this guide
There have been a number of changes to the MFTIP and revisions have been made to the Ontario Managed Forest Tax Incentive Program (MFTIP) Guide. The major changes are listed below along with a reference to where additional information may be found in this 2012 guide.
Contact information:
The Ministry of Natural Resources (MNR) administers the MFTIP. Contact information and where applications are to be sent has changed. See page 5 for details.
Planning forms:
The planning framework and forms for preparing a Managed Forest Plan are found in A Guide to Stewardship Planning for Natural Areas. To order a copy, contact the Managed Forest Tax Incentive Program (see page 5 for details).
Assessment of properties in the MFTIP:
The Municipal Property Assessment Corporation (MPAC) can answer questions about how the MFTIP will change your property assessment. See page 5 for contact information.
Open areas:
The definition of eligible open area has changed to better recognize the diversity of Ontario’s forests. See page 6 for details.
Application deadline:
The application package must be submitted by June 30 to have property taxes changed for the following year. See page 7 for details on submitting an application package.
Plan period:
The plan period has been increased from 5 to 10 years.
Five-year progress report:
You must complete and submit a Five-Year Progress Report by July 31 of your fifth year in the MFTIP. See page 10 for details.
Sale of properties:
Purchasers who want to keep a property in the MFTIP must have their plan approved by a Managed Forest Plan Approver. See page 11 for information on buying and selling MFTIP properties.
Ineligible properties:
Information on ineligible properties is referenced on the back of the application form. Details are in corresponding sections of this guide and on page 11.
Introduction
Certain forestlands in Ontario may be privately owned, but they benefit all Ontarians. The Ontario Managed Forest Tax Incentive Program (MFTIP) recognizes the importance of these lands. The goal of the MFTIP is to bring greater fairness to the property tax system by valuing forestland according to its current use. The program is designed to increase landowner awareness about forest stewardship. This guide contains information on how to enter the MFTIP and the program’s ongoing administrative requirements.
Landowners who apply and qualify for the program have the eligible portion of their property classified and assessed as Managed Forest under the Managed forests property class. The eligible land is taxed at 25 percent of the municipal tax rate set for residential properties.
In some parts of the province where property taxes are relatively low, the savings from the MFTIP will not be as great as in areas where property taxes are higher. If you decide that the property tax incentive is not of interest, you are encouraged to review A Guide to Stewardship Planning for Natural Areas to learn more about land stewardship and the benefits of good forest management.
Questions about the MFTIP
The Ministry of Natural Resources (MNR) administers the MFTIP. Program staff located in Peterborough can provide you with more information about the program and provide a copy of A Guide to Stewardship Planning for Natural Areas.
Managed Forest Tax Incentive Program guides and information can be down loaded from the web in .pdf format from the MFTIP website (ontario.ca/MFTIP).
Managed Forest Tax Incentive Program
Ministry of Natural Resources
300 Water Street
Peterborough, ON K9J 8M5
website: ontario.ca/MFTIP
Email: MFTIP@ontario.ca
Questions about property assessment
The Municipal Property Assessment Corporation (MPAC) assesses property in Ontario. MPAC can answer questions about how the MFTIP will change your property assessment.
MPAC head office
1305 Pickering Parkway
Pickering, ON L1V 3P2
Toll-Free:
Internet: Municipal Property Assessment Corporation
MFTIP eligibility requirements
The annual application deadline for the MFTIP is June 30, so it is a good idea to start preparing your application package early in the year.
Eligible lands
The following criteria must be met for a property to be eligible for the MFTIP.
The property is in Ontario
- The property is owned by:
- a Canadian citizen(s) or permanent resident(s);
- a Canadian corporation, partnership or trust; or
- a conservation authority.
The program application has more information on this requirement.
- The forest:
- covers at least four hectares (9.88 acres) excluding residences; and
- is on one property with one municipal roll number.
The forest includes a minimum of:
- 1,000 trees of any size per hectare (400 trees per acre); or
- 750 trees per hectare (300 trees per acre) measuring more than 5 centimetres (2 inches) in diameter; or
- 500 trees per hectare (200 trees per acre) measuring more than 12 centimetres (5 inches) in diameter; or
- 250 trees per hectare (100 trees per acre) measuring more than 20 centimetres (8 inches) in diameter.
The diameter measurements of trees are taken 1.3 metres (4.5 feet) above the ground. For the purpose of MFTIP, a tree is any species listed in the book “Trees in Canada” by John Laird Farrar. Some restrictions may apply.
- Open areas: On an eligible property, some area with less than the minimum number of trees may be entered into the program:
- natural areas, such as forest openings or abandoned farm fields. No more than ten (10) percent of the total eligible forested area, by roll number, may be entered into the MFTIP under this category.
- natural areas that could not support trees through normal forest management activities. This includes swamps or beaver floods, land without enough soil to grow trees and open water. No more than twenty-five (25) percent of the total eligible forested area, by roll number, may be entered into the MFTIP under this category.
Ineligible lands
Property is not eligible for the MFTIP if:
- it is licensed under the Aggregate Resources Act, or is zoned for aggregate extraction (gravel pits) in areas outside the jurisdiction of the Act; or if
- it is owned by the municipal, provincial or federal government (that pay grants in lieu of taxes).
On eligible properties, residences, landscaped and residential use areas are not eligible for the MFTIP. At least one acre is deducted for residences or a group of buildings as defined by MPAC. There is no area deduction for outbuildings used specifically for forestry purposes.
Land used for other purposes such as golf courses, campgrounds or ski hills are usually not eligible for the MFTIP. There are some exceptions. The MFTIP Administrator can provide more information.
Entering the MFTIP
Properties are entered into the MFTIP for a ten-year period. The following provides details on how to enter the MFTIP.
Preparing an application package
Prepare a Managed Forest Plan
Your application must include a Managed Forest Plan with a long-term horizon (20 years and beyond) and a description of the activities you will carry out over the next ten years.
A Managed Forest Plan can be written to include more than one property (i.e., assessment roll number). However, each property must qualify for the MFTIP on its own merit.
The planning framework is found in A Guide to Stewardship Planning for Natural Areas. A local MNR office or the MFTIP Administrator can provide you with a copy of the guide or you can obtain it from the MFTIP website. Plans may be based on earlier versions of the MFTIP guide. Table 1 lists plan requirements. Management activities for properties in the MFTIP are discussed in Table 2.
Have your Managed Forest Plan approved
A person designated by the MNR as a Managed Forest Plan Approver must approve your plan. Managed Forest Plan Approvers are independent contractors and charge for their services. You can get a list of Approvers from the MFTIP Administrator or the MFTIP website (ontario.ca/MFTIP).
The Approver will:
- visit your property and verify that the forest is eligible;
- ensure that your plan, maps and proposed activities meet program standards; and
- complete approval forms.
The Approver may also:
- prepare maps and inventory;
- recommend management activities; and
- prepare or revise your plan to meet program standards.
Submit the application package by the deadline
The application deadline for new participants is June 30. Submit the following to the MFTIP Administrator to have your property taxes changed for the following year:
- the MFTIP application form;
- a copy of the Managed Forest Plan (approved by a Managed Forest Plan Approver);
- an Area Verification Form for each property and an Approval Form, both completed by a Managed Forest Plan Approver; and
- a copy of the most recent Notice of Property Assessment for each property (i.e., assessment roll number) in the plan.
Late or incomplete applications cannot be processed and will be returned to the landowner.
Make sure that you keep a copy of your plan. If you are selected for audit by the MNR and do not have a copy of your plan, your property will be ineligible for the program (refer to ineligible properties on page 11).
Table 1: MFTIP plan requirements
The following table lists the requirements of a Managed Forest Plan for entry into the MFTIP based on the planning framework found in A Guide to Stewardship Planning for Natural Areas. Detailed requirements are found in the Standards and Review Criteria for Managed Forest Plans Prepared Under the Managed Forest Tax Incentive Program. Managed Forest Plan Approvers have this document.
Section 1: Property owner information
Identify the plan period, ownership information and person who prepared the plan
Section 2: Property location information
Record information on property location (roll number, lot, concession, township) and size
Section 3: Property history
Provide the history of the property and how the property relates to the surrounding landscape
Section 4: Property map and surrounding area
This map provides an overview of your property and shows its relationship to the surrounding area. It must also show tax assessors and other officials where the property is located. To allow for reassessment of your property this map must:
- clearly indicate the area(s) eligible for the MFTIP
- show any residences or structures
- have the 19 digit assessment roll number listed
- allow a person who is not familiar with your property to locate it
Note: depending on map scale and detail, the map from Section 6 may also be helpful in preparing maps to allow for reassessment.
Section 5: Landowner objectives
- Identify and rank your management objectives
- Describe how the objectives will be achieved
Section 6: Detailed property map
Identify the different types of forest areas (these areas are referred to as compartments) and map them in relation to each other.
Section 7: Managed forest compartment descriptions—Inventory forms
An inventory sheet is completed for each compartment being entered into the MFTIP (i.e., Getting to Know Your Upland Areas or Getting to Know Your Wetland Areas). Points to consider:
- the items inventoried are based on your objectives and program standards
- an enhanced inventory should be planned or completed if a commercial harvest is proposed during the period of the plan
Note: the Enhanced Forest Inventory and Harvest Plan from A Guide to Stewardship Planning for Natural Areas provides a framework for data collection for forest management operations.
Note: Managed Forest Plan Approvers can help you determine eligible areas and assist in inventory collection.
Section 8: Ten-year activity summary
List the activities that you plan to carry out on your property, along with a quantifiable measure that will allow you to judge your accomplishments.
Section 9: Report of activities
Record your management activities as you complete them during the term of the plan.
Section 10: Contacts and notes
Record information sources, contacts made, workshops attended, etc., during the term of the plan.
Table 2: Management activities on properties in the MFTIP
The MFTIP encourages appropriate management activities
To meet your objectives, forest management activities may be required. Appropriate management activities for the MFTIP include:
- tree planting of native tree species, tending, thinning, pruning and harvesting;
- recreational activities such as hiking, skiing or hunting;
- wildlife management involving habitat work or participating in monitoring programs;
- protecting environmentally sensitive areas by limiting disturbance; and
- learning about your forest.
Activities on properties in the MFTIP are to be carried out according to “good forestry practices” as defined in the Forestry Act. Good forestry practices means “the proper implementation of harvest, renewal and maintenance activities known to be appropriate for the forest and environmental conditions under which they are being applied and that minimize detriments to forest values including significant ecosystems, important fish and wildlife habitat, soil and water quality and quantity, forest productivity and health and the aesthetics and recreational opportunities of the landscape.” Tree cutting is to be carried out according to MNR’s silvicultural guides. Guides are available from the Natural Resources Information Centre at:
The MFTIP encourages landowners to take an active role in maintaining the health of the forest. It is important to inspect the forest for insects, disease and other problems and monitor the results of activities. Being inactive because you are not sure of what kind of forest you have, or what management activities are appropriate, is not acceptable in the MFTIP. Seek the assistance of a forest consultant.
Activities not permitted in the MFTIP
Activities that are not in accordance with good forestry practices are not permitted in the MFTIP. This includes, but is not limited to:
- high-grading, or diameter limit cutting;
- pasturing livestock;
- removing soil from the forest; and
- continued inactivity that degrades the health of the forest.
Additional information on these activities may be obtained from a Managed Forest Approver or from the MNR.
The MNR carries out audits, including field visits. Audits may be conducted after a landowner has removed the property from the MFTIP. Activities not in accordance with good forestry practices make a property ineligible for the program.
If MNR finds that a property has become ineligible for the MFTIP while it is in the program, MNR may remove the property from the program. As the property received benefit under the MFTIP (while not eligible), the municipality may choose to collect the taxes that would normally have been owed, had the property not been part of the MFTIP [as per Section 33(4) and 33(5) of the Assessment Act].
The Ontario Professional Foresters Association (OPFA) is responsible for regulating professional forestry in Ontario. Landowners who are planning forest management operations, such as tree harvesting, and who want a guarantee of professional standards, should consult a Registered Professional Forester or an Associate Member of the OPFA. For more information, contact the OPFA at
Other program information
The following information will help with ongoing participation in the MFTIP.
How to stay qualified
Follow your approved Managed Forest Plan
Manage your property according to your Managed Forest Plan and keep good records. MNR will notify you to confirm your participation and remind you of program requirements during the term of your management plan.
Submit your five-year progress report
You must complete and submit a Five-Year Progress Report by July 31 of your fifth year in the MFTIP. MNR will mail you a copy of this report to complete.
A copy of the Report of Activities (Section 9) and any changes to the Ten-Year Activity Summary must also be submitted (updates to Section 8). If you do not submit a Five-Year Progress Report, your property will be ineligible for the MFTIP (refer to ineligible properties on page 11).
Update your plan every ten years
Your property will remain in the MFTIP for ten years at which time your Managed Forest Plan must be updated. When updating your plan:
- make sure that it meets the most recent program standards;
- a new inventory may be required if your forest has changed. Enhanced inventories are also a good idea if a harvest is planned or has taken place; and
- the updated plan must be approved by a Managed Forest Plan Approver.
Submit a new application package
You must complete and submit an application package to the MFTIP Administrator by July 31 of year ten in the program. The package must include a completed copy of the Report of Activities (Section 9) from the plan that is being renewed.
If you do not renew your plan after ten years, you must submit a Landowner Report and a copy of the Report of Activities (Section 9) to the MFTIP Administrator. A Landowner Report is found in this guide. If this information is not submitted, your property will be ineligible for the MFTIP (refer to ineligible properties on page 11).
Leaving the MFTIP
You may remove your property from the MFTIP at any time. To remove a property, send a written notice, a completed Landowner Report and a copy of the Report of Activities (Section 9) to the MFTIP Administrator.
Changing eligible area
Increases or decreases in eligible area must be approved by a Managed Forest Plan Approver.
- To increase eligible area, an updated property map and inventory forms (Sections 4 and 7 of your plan) must be submitted to the MFTIP Administrator, along with approval forms completed by a Managed Forest Plan Approver.
- To decrease eligible area, an updated property map (Section 4), a copy of the Report of Activities (Section 9), and a completed Landowner Report must be submitted, to the MFTIP Administrator, along with approval forms completed by a Managed Forest Plan Approver.
Changes to objectives or planned activities
Changes to objectives or planned activities that do not modify the eligible area do not require an approval but must be documented. Make sure that you keep track of the following:
- what has changed;
- why the changes were made;
- the inventory forms (Section 7) if your activities require enhanced inventory data; and
- update the Ten-Year Activity Summary (Section 8).
Severing a property
Properties that are severed or split are removed from the MFTIP by MPAC. To re-enter the program, each property must qualify for the MFTIP on its own merit. After revising the plan and map, re-submit the application package (refer to page 7) to the MFTIP Administrator.
Buying and selling managed forests
The Managed Forest Plan is the property of the landowner who had it prepared. The Forest Plan Approver and MNR are not able to provide copies without permission from the landowner. Properties that are sold are removed from the MFTIP by MPAC. A new landowner must apply to the program within 90 days of the sale to keep the property in the program.
Vendors
Tell your realtor that your property is in the MFTIP. When the property is sold, send written notice, a completed Landowner Report and a copy of the Report of Activities (Section 9) to the MFTIP Administrator.
Purchasers
Purchasers can determine if a property is in the MFTIP by contacting MPAC. Properties are removed from the Managed Forest property class at the time of sale by MPAC.
If the vendor carried out activities that harmed the forest, an MNR field audit may find the property ineligible for the MFTIP. The purchaser may have to repay taxes (refer to ineligible properties on page 11). The offer to purchase should protect the purchaser if the property was ineligible for the MFTIP while owned by the vendor. Purchasers who want to keep the property in the MFTIP should:
- review the program guide;
- attempt to get a copy of the Managed Forest Plan from the vendor to determine how the property was managed;
- update the current plan or prepare a new plan to reflect your management objectives; and
- have the plan approved by a Managed Forest Plan Approver
A MFTIP application and associated paperwork, completed by a Managed Forest Plan Approver, must be sent to the MFTIP Administrator. The application must be received within 90 days of the closing of the sale, or it will be removed from the program.
Appeals dealing with managed forests
You may disagree with information on your Property Assessment Notice or with the stated amount of property that you have in the Managed Forest property class. To verify the area classified as Managed Forest, contact MPAC.
If you think that there is an error, you may request a review of:
- the assessed value: the values placed on the property
- the classification: the amount of property that you have in the Managed Forest property class
For information on reviewing your property’s value, refer to the bottom of your Property Assessment Notice. If you think that the area classified as Managed Forest is wrong, contact the MFTIP office. If a change is agreed to, you will be asked to sign a Minutes of Settlement. If there is no agreement, you have the option of an appeal to the Assessment Review Board.
MNR field audits and ineligible properties
The MNR is responsible for ensuring that properties in the MFTIP are eligible for the program.
MNR field audits
All activities must be carried out according to good forestry practices as defined in the Forestry Act (refer to Table 2). The MNR carries out audits, including field visits. Activities not in accordance with good forestry practices make a property ineligible for the program. The MNR may conduct an audit at any time, including after a property has been removed from the program by the landowner.
Properties which become ineligible for the MFTIP while in the program
If MNR finds that a property was not eligible for the MFTIP while receiving program benefits, MNR may remove the property from the program. As the property received benefit under the MFTIP (while not eligible), the municipality may choose to collect the taxes that would normally have been owed, had the property not been part of the MFTIP [as per Section 33(4) and 33(5) of the Assessment Act.