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Information for Municipalities Concerning Education Property Tax

Education property tax (EPT) collected by municipalities is paid to the provincial government’s General Revenue Fund. Monthly EPT returns are filed electronically with the Ministry of Finance starting with the monthly EPT return for taxes collected in January 2018. All monthly returns will be entered into Saskatchewan Electronic Tax Service (SETS). The due date for submitting monthly EPT statements and remitting EPT funds has not changed. The January 2018 EPT return and payment is due by February 10, 2018.

The prescribed classes of property used to calculate EPT mill rates have one additional class compared to the property classes used for municipal property tax purposes. Any discounts offered by the municipality do not apply to EPT.


1. Separate School Divisions that Pass a Bylaw

Municipalities will continue to collect and remit funds to the separate school board directly if a separate school division passes a bylaw to set its own mill rate. When a municipality is collecting EPT for a separate school division that has a bylaw, the return information must be:

  • submitted in SETS (for information purposes only); and
  • sent to the separate school division.

2. Tax Client Readiness Kit

Several resource documents are available to aid municipalities in the transition to the new EPT system.

Coming soon to the Tax Client Readiness Kit: an EPT recorded webinar.


3. Penalties and Interest for Late EPT Submissions

Monthly EPT returns are due by the 10th of the month following the reporting period. To avoid penalty and interest, submit the completed return and payment to Finance by the due date (including nil returns). Penalty and interest charges are applied to taxes that are not remitted by the due date. These charges are necessary to ensure that taxes are collected and remitted on time.

A penalty of 10 per cent of the EPT payable, to a maximum of $500 is applied to each return period. In addition, there is a $75 penalty for failure to remit a return. Interest is charged at the prime interest rate plus 3 per cent from the date the EPT was to have been remitted.

Municipalities should consider adopting a municipal bylaw or policy to authorize that EPT collected for the month can be paid by the due date rather than waiting for a council meeting. Establishing this process will help to avoid the new fines and penalties for late payment. This bylaw would be similar to what you may already have in place for payment of salaries, payroll remittances, utility billings, etc. A sample Expenditure-Authorization bylaw is available online.


4. EPT Exemptions and Abatements

The rules about granting an exemption or abatement for EPT have changed starting in the 2018 taxation year.

  1. Any multi-year exemptions that have been granted by a municipal council prior to January 1, 2018, under previous legislation, will continue. Existing agreements will run their course until they expire, after which the new legislation will apply. The Education Property Tax Act comes into effect January 1, 2018.
  2. Council may continue to enter into multi-year exemption agreements for EPT. The agreement must exempt EPT in the same percentage as municipal tax. The agreement must be for 5 years or less.
  3. Council may continue to use multi-year abatement policies or programs for EPT for a specified time period in accordance with the Municipal Acts.
  4. Municipal council can choose to exempt/abate EPT taxes in the same percentage as municipal tax on an annual basis.
  5. If the EPT portion of the proposed abatement/exemption for a single property or parcel of land will result in EPT loss of $25,000 or more for the tax year, the municipality must seek prior provincial approval annually. If the EPT amount is less than this threshold, no provincial approval is required.
    • Multi-year agreements between the municipality and the province for exemptions and abatements (no more than 5 years) are possible, so EPT treatment is consistent with municipal property tax.
    • The municipality must submit any information requested in the agreement to the province.
    • The province can terminate the agreement if:
      • the municipality fails to comply with the terms and conditions of the agreement; or
      • the minister considers it necessary and in the public interest to do so.
  6. If a municipality chooses to exempt/abate more than 5 per cent of the total EPT levy within that municipality for the year, the province will undertake an audit and approval process of the abatements and exemptions given.

Note: Providing property tax exemptions will remain a local choice at this time, subject to the above approval requirements. Providing property tax exemptions means less tax revenue for essential public services, or a potential taxation shift to other properties and owners. Local governments understand the unique needs and circumstances of residents in their municipality. However, if future EPT exemption and abatement trends begin to significantly increase, causing a large loss of revenue and taxation shift, the province will reconsider the rules and thresholds established for the EPT exemption/abatement approval process.


5. EPT Exemption and Abatement Approval Process

When a municipality seeks approval from the province to exempt or abate EPT revenue that is over the $25,000 threshold or more than 5 percent of the total EPT levy, the target will be to make the decision within 15 business days after receiving all pertinent information.

Applications will be categorized into three main categories:

  1. Economic Development
  2. Housing; and
  3. Non-Profit/ Community based organization

A fourth category called “Other” may be used if an unusual or unprecedented circumstance arises that is not captured in one of the three main categories. Applications submitted under this category will be assessed case by case based on its merits.


6. 2017 Monthly Returns (Form H2)

The EPT that municipalities collect in December 2017 will be remitted directly to school divisions in January 2018. The December 2017 monthly EPT return will be filed by:

  • completing Form H2
  • sending a copy of the form along with payment to the appropriate school division; and
  • sending a copy of the form to the Ministry of Government Relations.

7. 2017 Annual EPT Return (Form H)

The 2017 annual EPT return will be filed using the existing process. Please complete Form H and send a copy of the form to the appropriate school division, the Ministry of Education and the Ministry of Government Relations. The 2017 annual EPT return is due on January 15, 2018.


8. Interim Return

Beginning January 1, 2018, the Interim return, usually submitted in September, is no longer required.

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