Free Ontario Rent Increase Notice Template Guide - Legal Templates Canada

Ontario Rent Increase Notice is a legal document landlords must use when increasing rent. In Ontario, you cannot just raise rent anytime—you must follow strict rules under the Residential Tenancies Act.

If you’re a landlord or property manager, this article will help you stay compliant. If you’re a tenant, it will help you understand your rights before accepting any rent increase.

A rent increase notice tells a tenant that their rent will go up on a future date. Under Ontario law, landlords must follow clear rules before doing this.

In most rental situations:

You must give proper written notice
You must follow the yearly rent increase limit
You cannot increase rent whenever you want

This article includes a free template, legal rules, and step-by-step instructions so you can do it correctly.

Free Ontario Rent Increase Notice Template

You can use this sample as a basic draft. It is helpful for understanding what information is required.

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Tip: Use this template to understand the structure. For legal compliance, always use official Ontario forms when required.

What Is a Rent Increase Notice in Ontario?

A rent increase notice is a written notice from a landlord telling a tenant that rent will increase.

It is important to understand this:

The notice is not the increase itself
It simply informs the tenant about a future change
The increase only becomes valid after proper notice and timing

Under Ontario law:

Verbal notice is not allowed
Written notice is mandatory
It applies to most residential rental units

Ontario Rent Increase Rules You Must Follow

This is the most important part. If you break these rules, your rent increase can be invalid.

90-Day Notice Rule

Landlords must give at least 90 days written notice.

If you give less than 90 days → the increase is invalid
The clock starts from the day the tenant receives the notice

Once Per 12 Months Rule

You can only increase rent:

Once every 12 months, and
Only after the tenant has lived there for at least 12 months

Even if the tenant is on a month-to-month lease, this rule still applies.

Government Rent Increase Guideline

Ontario sets a yearly limit on rent increases.

For example:

A typical guideline may be around 2.5% (varies by year)

This means:

You cannot increase rent beyond this limit without approval

Approved Above-Guideline Increases

In some cases, landlords can increase rent more than the guideline.

This is allowed only if:

You apply to the Landlord and Tenant Board
The increase is approved

Common reasons:

Major building repairs
Increased property taxes
Utility cost increases

Official Forms vs Custom Templates

This is where many landlords make mistakes.

Type	Purpose	Legal Status
Custom Template	Understanding / drafting	Not legally required
N1 / N2 Forms	Official notice	Required by law

Under Ontario law:

You MUST use official forms like N1 or N2 in most cases
A custom template alone is not enough

Risk of using wrong format:

Tenant can refuse to pay
Notice becomes invalid
You may need to restart the process

When Can a Landlord Increase Rent?

After Lease Completion

When a fixed-term lease ends:

It usually becomes month-to-month
Rent can be increased with proper notice

Month-to-Month Tenancies

Even in month-to-month:

90-day notice is still required
12-month rule still applies

New Tenants vs Existing Tenants

This is a key rule many people misunderstand.

Existing tenants: Rent increase rules apply
New tenants: No limit on rent

This means:

When a unit becomes vacant, landlords can set any new rent

Key Elements of a Valid Rent Increase Notice

A proper notice must include:

Tenant and Property Details

Full tenant names
Correct rental address

Current and New Rent Amount

Clearly show both amounts

Percentage Increase Calculation

Must match the guideline (unless approved otherwise)

Effective Date (90-day gap)

Must be at least 90 days ahead

Compliance Statement

Mention if it follows guideline or approved increase

How to Fill Out the Rent Increase Notice (Step-by-Step)

Step 1 – Check Guideline Percentage

Look up the current Ontario rent increase guideline for the year.

Step 2 – Calculate New Rent

Example:

Current rent = $1,000
Increase = 2.5%
New rent = $1,025

Step 3 – Set Correct Notice Period

Choose a date at least 90 days ahead.

Step 4 – Complete Tenant Details

Ensure:

Names are correct
Address is accurate

Mistakes here can invalidate the notice.

Step 5 – Deliver Notice Properly

This step is critical (explained below).

How to Deliver the Notice to Tenants

You must deliver the notice properly for it to be valid.

Accepted methods:

In person
By mail
Email (only if tenant agreed in writing)

Important:

Always keep proof of delivery
Take a photo or keep a receipt

Common Mistakes That Make a Rent Increase Invalid

Avoid these common errors:

Giving Less Than 90 Days Notice

This is the most common mistake.

Increasing Rent Too Soon

If 12 months have not passed → not allowed

Exceeding Guideline Without Approval

You must get approval first

Using Wrong Form or Missing Details

Incorrect format = invalid notice

Verbal Notice Only (Not Allowed)

Written notice is required under law

What Happens If a Rent Increase Is Illegal?

If the notice is not valid:

Tenant can refuse to pay increased rent
Tenant can file a complaint with the Landlord and Tenant Board
Landlord may face delays or penalties

Important:
Landlords are not allowed to pressure tenants into accepting illegal increases.

Real-Life Example

Legal Rent Increase

Rent: $1,200
Increase: 2.5%
Notice: Given 90 days in advance
Result: Valid increase

Invalid Rent Increase

Rent: $1,200 → $1,400
No approval
Only 30 days notice

Result: Tenant can legally refuse

Rent Increase vs Rent Review

Feature	Rent Increase	Rent Review
Purpose	Raise rent	Check fairness
Frequency	Once per year	Case-based
Approval	Not always	Often required
Legal Process	Structured	More complex

FAQs

Can a landlord increase rent every year?

Yes, a landlord can increase rent, but only once every 12 months. They must also give proper written notice before increasing it.

Can tenants refuse a rent increase?

Yes, tenants can refuse if the increase is not legal or does not follow Ontario rent rules. They can also challenge it through the proper authority.

What is the maximum rent increase in Ontario?

The maximum increase depends on the yearly guideline set by the government. For example, it is often around 2.5%, but it can change each year.

Do I need to sign a new lease after increase?

No, you do not need to sign a new lease. If the notice is valid, the rent increase will automatically apply to your current agreement.

Can rent be increased during a fixed lease?

Usually, rent cannot be increased during a fixed lease period. It can only be increased after the lease term ends or renews.