Residents face bank charges after City of Toronto property tax double-billing error

The Toronto man who alerted Global News to an $87 million property tax overbilling blunder has now been charged bank service fees even though he was not at fault and paid his taxes properly.

Azim Ruda received a notice saying he was being charged $40 in NSF fees and was served a letter by the city informing him that he has been removed from the city’s pre-authorized tax payment program.

On March 1, participants in that program saw half their annual tax bill paid from their bank accounts, a system that has been in place for about 20 years. Many find it a convenient way to pay their taxes. But 44,000 participants actually had twice the correct amount withdrawn from their accounts that morning, an overbilling the city said amounted to $87 million.

In Ruda’s case, his bank withdrew the proper amount pf $1,365, but it made a second, incorrect withdrawal for the same amount. Ruda also helps manage the finances for his 75-year-old aunt. He said her tax payment of $1,271 was also debited twice.

READ MORE: Toronto taxpayers double-billed on property tax after pre-authorization snag

“I had to physically go to my bank and spend almost an hour all because of {the City of Toronto’s] error,” Ruda said.

Later that day, the city replaced the funds and apologized for the mistake. But in cases like Ruda’s, they replaced the amount a second time. Technically due to the city’s mistake and attempt to repair it, Ruda’s account and his aunt’s account, were not paid up.

This week, bank service charges were assessed and Ruda received a menacing letter saying he was kicked out of the pre-authorized payment program.

“It’s disgusting,” Ruda said, adding other taxpayers, especially seniors, might not have the means to pay extra, unwarranted charges, or might not notice them.

“It appears there were a very small number of people (out of 44,000 accounts) who asked their bank to reinstate the property tax payments withdrawn in error which means they didn’t end up paying their property tax payment at all. This generated an automatic non-payment form, which this person received,” Jackie DeSouza, director of strategic communications for the City of Toronto, said.

“Revenue Services has been contacting the owners of these accounts to discuss and ensure the account is paid, while crediting any fees incurred,” she said.

Tweet This Click to share quote on Twitter: "Revenue Services has been contacting the owners of these accounts to discuss and ensure the account is paid, while crediting any fees incurred," she said.

Casey Brendon, the city’s director of revenue services, told Global News Wednesday that while the city hasn’t been able to determine who was responsible for the $87 million billing mistake, he’s confident another misstep like this won’t happen again because more scrutiny has been added into the system.

Toronto city councillor and deputy mayor Denzil Minnan-Wong told Global News the city’s billing system is generally good.

“We’re a large organization, we have tens of thousands of bills going out. We’re going to make mistakes from time to time. Accountability means admitting the mistake, correcting the mistake and apologizing for the mistake,” he said.

Ruda, who got a personal call from Brendon apologizing for the billing error, said he isn’t taking any chances with pre-authorized payments again. He said he’s going to send his tax payments directly to the city from now on.

With files from Alana MacLeod