The N2 Notice, Step by Step: Rent Increases in Ontario's Partially Exempt Units

In Ontario, the N2 is the Landlord and Tenant Board's notice for raising rent on a unit that the RTA does not cap by amount. Its main users run social housing, non-profit housing, or other housing with public assistance. For tenants, an N2 means the annual guideline is not a ceiling, but in most cases you are still owed 90 days' written notice and at least 12 months between increases.

The N2 in brief

Which units count, and why "partially"

For some units, the RTA turns off its rent-control rules while every other part of the Act stays on. Hence "partially". The groups are:

Under RTA s. 7(1):

• federally owned or federally operated units;
• designated housing projects run by a local housing corporation or service manager;
• non-profit housing that came out of a prescribed program and is now run under the Housing Services Act, 2011 or under a qualifying agreement;
• non-member units in non-profit co-ops;
• housing a college, university or other educational institution provides to its students or staff; and
• units run on a non-profit basis by a religious institution for a charitable purpose.

Neither s. 120 (the guideline) nor the above-guideline increase rules reach these units.

Under O. Reg. 516/06, s. 6: units acquired or developed through listed affordable-housing programs that satisfy the conditions in s. 6(2) (two examples: the Canada-Ontario Affordable Housing Program, and municipal capital facility by-laws), along with Rural and Native Rental Housing Program units.

On the form, the tenant sees the new rent and an explanation that, with no guideline in play, the increase can be any amount.

Choosing the right notice

Step 1: confirm the unit is in one of the groups above. The N2 instructions offer social and non-profit rental housing as the main example, along with care home units that are exempt from the limits on increases.

Step 2: rule out the other notices.

Step 3: check the exceptions that switch rent control back on.

• [ ] Federal or service-manager project, yet rent is paid to a different landlord? Rent control applies again (s. 7(4), (5)).
• [ ] Housing for students or staff where a residents' association or council exists, and nobody consulted it about the increase? Also back under rent control (s. 7(6)).

A grey area: units first occupied after November 15, 2018. According to the N1 instructions, units free of the limits on the size of an increase take the N2, and units under RTA s. 6.1 fit that description. Yet the N2 instructions (May 2017) were written before s. 6.1 and mention only social and non-profit housing. The LTB hasn't said which of the two notices it expects for a s. 6.1 unit. Either way you need an approved form with no less than 90 days' written notice (s. 116), so confirm with the LTB before you serve.

Timing rules: notice and the 12-month gap

Notice period. Section 116 of the RTA covers partially exempt units too. That means:

• give at least 90 days' written notice;
• if you mail it, add five days (s. 191(3));
• this period can't be shortened by the LTB (O. Reg. 516/06, s. 56).

The one exception: skip the notice when a rent-geared-to-income tenant's rent rises because their income rose, in a unit under paragraphs 1 to 4 of s. 7(1) or under s. 6 of the regulation (RTA s. 7(3); O. Reg. 516/06, s. 6(5)). That's what "where applicable" on the form refers to.

Worked example. A housing provider mails an N2 on Friday, February 26, 2027. Adding the five mailing days, it counts as given on Wednesday, March 3. Ninety days on from March 3 is Tuesday, June 1, 2027, so June 1 is the earliest the new rent can start.

The 12-month gap. Usually RTA s. 119 applies. Two groups are carved out (s. 7(2); O. Reg. 516/06, s. 6(4)):

• rent-geared-to-income tenants in units under paragraphs 1 to 4 of s. 7(1), or under s. 6 of the regulation;
• housing for students or staff, and religious-charitable housing.

Filling in the N2: six steps

The N2 in use now is the one-page 01/04/2022 version.

1. To: (Tenant's name and address). Name each tenant; give a separate mailing address where there is one.
2. From: (Landlord's name and address). Name each landlord and include a mailing address.
3. Address of the Rental Unit. Write it out fully: street, unit, postal code.
4. Your New Rent. Fill in: - "On dd/mm/yyyy": when the increase takes effect; - "your rent will increase to $": the full new rent, not just the increase; - "per month / week / other": the rent period.

Separately paid service charges are part of the rent, the form notes, but in a care home, charges for meals or care services are not. 5. Important Information About the Law. Don't change the printed text. 6. Signature. Shade Landlord or Representative, print a name and phone number, then sign and date. Representatives fill in their own block too.

You won't find the N1's "explanation of the increase" section or guideline tick-box on this form.

Delivering it to the tenant

Methods the N2 instructions allow:

• [ ] giving it in person to the tenant or another adult at the unit;
• [ ] leaving it in the mailbox, or wherever mail usually arrives;
• [ ] sliding it beneath the door, or through a mail slot;
• [ ] mailing it, or sending it by courier;
• [ ] faxing it to the tenant's home or workplace.

Email is also allowed under Rule 3.1, but only where the tenant has agreed to it in writing. Taping it to the door is not an approved method. Serve each tenant and keep a record of how and when you did it.

Five mistakes that undo the increase

1. Sending an N2 when the unit is really rent-controlled. The tenant hasn't been told about the guideline, and any amount above it is unlawful. Confirm the exemption, and rule out the s. 7(4)–(6) exceptions, first.
2. Treating "exempt" as "no notice needed". Apart from income-driven rent-geared-to-income changes, s. 116 still governs, and s. 116(4) voids an increase made without proper notice.
3. Raising a market-rent tenant twice within 12 months. Living in a partially exempt building doesn't by itself remove s. 119; only the categories above are carved out.
4. Folding meal or care charges into a care home tenant's rent. The form excludes them: put only the rent on an N2, and switch to the N3 for a rent-controlled care home.
5. Door-posting, or emailing a tenant who never consented in writing. Unless you can show the notice actually came to the tenant's attention in time, service is defective (s. 191(2)).

Afterwards: for landlords and tenants

Landlords: there is nothing to file. From the effective date the new rent applies; keep a copy of the N2 and your service record.

Tenants: if you think the unit isn't really exempt, or the notice or timing was wrong, act promptly. Under RTA s. 136, an increase is deemed lawful if no one challenges it within a year after it is first charged.

Your N2 questions

What makes a unit "partially exempt"?

Mostly, a listing in O. Reg. 516/06, s. 6 or RTA s. 7(1). That takes in service-manager and government housing, qualifying non-profits, non-member co-op units, school-provided housing and religious charitable housing. Their increases have no guideline cap, but most other RTA rules still apply.

Is 90 days' notice still required?

In most cases, yes. Only an income-driven rise in rent-geared-to-income rent, in the listed social housing groups, needs none.

Can an N2 increase go above the guideline?

Yes, if the unit truly is partially exempt; the form itself says there is no limit on the amount. If the exemption was misjudged, any amount over the guideline is unlawful.

Must 12 months pass between increases?

Generally yes. The exceptions (RTA s. 7(2)) are rent-geared-to-income tenants in listed social housing, and housing for students, staff or religious charities.

Official sources

• N2 form (PDF)
• N2 Instructions (PDF)
• N1 Instructions (PDF)
• Residential Tenancies Act, 2006, ss. 6.1, 7, 116, 119, 136 and 191
• O. Reg. 516/06 (General), ss. 6 and 56
• LTB Rules of Procedure
• Residential rent increases (ontario.ca)

Last reviewed October 31, 2026. General information, not legal advice for your situation. Always use the current version of the form from the LTB.