Above Guideline Increase (AGI) Notice — Rent Increase (Ontario)

An Above Guideline Increase (AGI) Notice — Rent Increase (Ontario) in Canada gives the tenant notice of a rent increase in the amount and timing permitted by residential tenancy law, governed primarily by provincial residential tenancies legislation.

In Ontario, residential rents are subject to annual rent increase guidelines set by the provincial government each year. As of 2025, the guideline is a maximum percentage increase that a landlord may impose without LTB approval. An AGI is a rent increase that exceeds this cap. It can only be implemented after the landlord has filed an application with the LTB, all affected tenants have had the opportunity to participate in the LTB hearing, and the LTB has issued a written order approving the specific percentage increase.

The three statutory grounds for an AGI are: (1) extraordinary increases in municipal taxes or charges, (2) eligible capital expenditures as defined in O. Reg. 516/06 (prescribed building improvements such as roof replacement, window replacement, elevator modernization, HVAC systems, or major structural repairs), and (3) operating costs related to security services for the residential complex. Routine maintenance, painting, cosmetic improvements, and repairs to fix damage or deterioration that resulted from a landlord's failure to maintain the property do not qualify.

Once the LTB order is issued, the landlord must serve formal written notice of the AGI on each tenant whose unit is subject to the increase, with at least 90 days' written notice before the increase takes effect. The notice must clearly state the LTB order number, the approved percentage, the new rent amount, and the effective date.

The legal framework governing the Above Guideline Increase (AGI) Notice — Rent Increase (Ontario) in Canada draws on several key statutes and regulatory bodies. Under provincial residential tenancies legislation — including Ontario's Residential Tenancies Act 2006 and British Columbia's Residential Tenancy Act (SBC 2002) — the Landlord and Tenant Board (Ontario) or Residential Tenancy Branch (BC) adjudicates disputes. The Land Title Act governs property registration through provincial land title offices. The Canada Revenue Agency (CRA) administers the non-resident property tax and GST/HST on real estate transactions. Parties executing a Above Guideline Increase (AGI) Notice — Rent Increase (Ontario) in Canada should confirm the document reflects current law, including any amendments enacted since the original drafting date. The Provincial Real Property Acts sets the foundational requirements.

When the LTB has issued an order approving an above-guideline rent increase and the landlord is ready to implement the increase on the eligible units, a formal AGI notice must be served on each affected tenant at least 90 days before the new rent takes effect.

When the LTB has ordered a phased-in AGI increase (spread over two or three rental years), the landlord must serve a separate notice before each phase takes effect, even though all phases are authorized by the same LTB order.

When a landlord has completed major capital expenditures on a residential complex — such as full roof replacement, elevator modernization, or major mechanical upgrades — and the LTB has determined that these qualify as eligible capital expenditures under O. Reg. 516/06, the AGI notice is the mechanism for passing the approved cost recovery on to tenants.

When a municipality has imposed extraordinary new charges (such as a special levy or an exceptional increase in property taxes) that the landlord has successfully argued before the LTB justify a rent increase above the provincial guideline.

Note: A landlord may not give tenants an AGI notice before the LTB has issued its written order. Serving a notice of an AGI before the order exists, or claiming an AGI percentage that differs from the approved amount, is invalid and may be challenged by tenants.

Parties in Canada should prepare a Above Guideline Increase (AGI) Notice — Rent Increase (Ontario) proactively rather than waiting for a dispute to arise. Courts interpret agreements based on the written terms rather than oral representations. Under provincial residential tenancies legislation — including Ontario's Residential Tenancies Act 2006 and British Columbia's Residential Tenancy Act (SBC 2002) — the Landlord and Tenant Board (Ontario) or Residential Tenancy Branch (BC) adjudicates disputes. The Land Title Act governs property registration through provincial land title offices. The Canada Revenue Agency (CRA) administers the non-resident property tax and GST/HST on real estate transactions. Where the transaction involves regulated activities, prior approval from the relevant authority may be required before execution.

Landlord and Tenant Identification — The full legal name of the landlord and all tenants at the rental unit subject to the increase. If the AGI applies to an entire building, a separate notice must be served on each individual unit.

Rental Unit Address — The complete civic address of the rental unit, including the building address and unit number.

LTB Order Reference — The LTB file or order number and the date of the order authorizing the above-guideline increase. Without a valid LTB order, an AGI notice has no legal basis and tenants are not obligated to pay the higher rent.

Approved Reason — The specific ground(s) approved by the LTB: extraordinary municipal tax increases, eligible capital expenditures, or security services operating costs. The notice should reference the same reason cited in the LTB order.

Current Rent and Increase Breakdown — The current monthly rent, the annual guideline increase percentage (if also being applied), and the additional above-guideline percentage approved by the LTB. Many AGI orders are implemented concurrently with the regular annual guideline increase, so the notice should separate the two amounts clearly.

New Monthly Rent — The specific new rent amount after both the guideline increase and the AGI increase are applied. This must match the calculation in the LTB order.

Effective Date — The date the new rent takes effect. Under s.116(1) RTA, this must be at least 90 days after the notice is served and must fall on the first day of a rental period (for monthly tenancies, the first day of the month).

Phase-In Schedule — If the LTB ordered a phase-in over multiple years, the notice must state the schedule for each phase, the percentage applicable to each phase, and the effective date for each phase.

Tenant Rights Information — A statement informing the tenant of their right to seek legal advice, contact the LTB, and access tenant legal resources such as Legal Aid Ontario and the Tenant Duty Counsel service.

Additional compliance elements for a Above Guideline Increase (AGI) Notice — Rent Increase (Ontario) used in Canada include: Under provincial residential tenancies legislation — including Ontario's Residential Tenancies Act 2006 and British Columbia's Residential Tenancy Act (SBC 2002) — the Landlord and Tenant Board (Ontario) or Residential Tenancy Branch (BC) adjudicates disputes. The Land Title Act governs property registration through provincial land title offices. The Canada Revenue Agency (CRA) administers the non-resident property tax and GST/HST on real estate transactions. Forms-legal.com provides this template as a starting point for Canada-compliant documentation.