The Ontario Standard Lease: every clause explained for 2026

Every Ontario tenancy that began on or after April 30, 2018 must use the government-mandated standard lease — and the stakes for getting it wrong range from tenants legally withholding a month's rent to lease clauses becoming unenforceable overnight. If you're signing new agreements in 2025 or preparing for 2026, this guide walks through every section of the form, explains what you can and cannot add, and flags the mistakes that send landlords to the Landlord and Tenant Board.

What Is the Ontario Standard Lease and Who Must Use It?

The Ontario Standard Lease — officially titled Form LTB-1 and governed under Section 12.1 of the Residential Tenancies Act, 2006 (RTA) — is a mandatory, government-prescribed tenancy agreement. As of the 2024 update, it applies to most private residential rental units in Ontario, including single-family homes, condominiums, secondary suites, and apartments.

Exemptions from the standard lease include:

Care homes and assisted-living facilities

Social and supportive housing

Mobile home lots and land lease communities

Accommodation that is co-operative housing

Vacation or tourist accommodations

• Rentals where the landlord and tenant share a kitchen or bathroom (i.e., a room in the landlord's principal residence)

If your unit is covered and a tenant requests the standard lease in writing, you must provide a signed copy within 21 days (RTA s. 12.1(6)). Failure to do so gives the tenant the right to withhold one month's rent — and if you still don't deliver within 30 days of that withholding, they can keep it permanently (RTA s. 12.1(8)).

A Section-by-Section Breakdown of the 2025 Form

The current form has Schedule A for additional terms and runs through twelve numbered sections. Here is what each one actually covers.

Sections 1–6: The Core Tenancy Details

Section 1 – Parties to the Agreement identifies the landlord(s) and tenant(s) by full legal name. Include every adult occupant who will be a party to the lease — omitting a tenant means that person has no tenancy rights, which can create complications at the LTB.

Section 2 – Rental Unit requires the full civic address plus any parking space or locker identifiers. If a parking space is included in the rent, name it here so it cannot be unilaterally removed later.

Section 3 – Contact Information captures landlord contact details. Under RTA s. 12, landlords must provide a name and address for service. A P.O. box is not sufficient — use a physical mailing address.

Section 4 – Term of Tenancy sets the start date and lease type (fixed-term or monthly). Fixed-term leases automatically convert to monthly tenancies at the end of the term under RTA s. 38 — you cannot force a tenant to vacate simply because the term expired.

Section 5 – Rent specifies the lawful rent, payment frequency, due date, and acceptable payment methods. Note that under RTA s. 108, landlords cannot require post-dated cheques as the sole payment method — you must offer at least one other option.

Section 6 – Services and Utilities distinguishes what is included in rent (heat, hydro, water) versus tenant-paid utilities. Getting this wrong affects Rent Increase Guideline calculations and any future Above-Guideline Increase (AGI) applications.

Sections 7–12: Responsibilities, Rules, and Signatures

Section 7 – Rent Discounts documents any lawful incentive such as a free-rent period. Document it here properly, or the discounted amount could be used to calculate a lower "lawful rent" for guideline purposes.

Section 8 – Rules and Conditions is a checkbox section covering smoking, pets, additional occupants, and parking. These checkboxes carry legal weight: if you check "no smoking," it is enforceable; if you leave it blank, you have no written basis for a smoking-related N5 notice.

Section 9 – Rental Unit Condition requires describing any existing damage. Treat this like a condition report — photograph everything and attach the photos to your copy.

Section 10 – Tenant's Insurance lets you require tenant liability insurance. If you check this box, specify the minimum coverage amount in Schedule A (typically $1–$2 million in liability is standard).

Section 11 – Changes to the Agreement reminds both parties that the RTA prevails over any conflicting lease term — a clause that purports to waive an RTA right is void (RTA s. 3(1)).

Section 12 – Signature requires wet or electronic signatures from all parties. Under Ontario's Electronic Commerce Act, 2000, e-signatures are valid. Platforms like DocuSign produce an audit trail that is accepted at the LTB.

Schedule A: What You Can and Cannot Add as Additional Terms

Schedule A is where landlords most frequently create legal problems. The governing principle is RTA s. 4: any term that is "inconsistent with" the RTA is void — not just unenforceable in court, but void from inception.

Lawful examples for Schedule A:

Requirement to maintain tenant liability insurance of at least $1,000,000

Tenant responsible for lawn care, snow removal on private walkways, or filter replacements

Specific pet rules (breed or weight restrictions are permitted as a private contractual term, though a landlord cannot evict solely for having a pet unless it causes problems — RTA s. 76)

Procedures for submitting maintenance requests in writing

1. Restrictions on short-term rentals (Airbnb) of the unit

Clauses that are void no matter how they're worded:

"Tenant waives right to dispute rent increases"

"Landlord may enter with less than 24 hours notice" (RTA s. 27 requires 24 hours minimum)

"Tenant is responsible for all repairs" (contradicts RTA s. 20 landlord maintenance obligations)

"No subletting under any circumstances" (RTA s. 97 gives tenants a right to request subletting)

1. "Lease does not automatically renew" (contradicts RTA s. 38)

If a void clause is included, it does not invalidate the entire lease — the offending term simply falls away, and the RTA default applies.

Rent, Deposits, and CRA Considerations

Last Month's Rent Deposit Rules

Ontario law permits only one type of deposit: a last month's rent (LMR) deposit equal to no more than one month's rent (RTA s. 105). Security deposits, pet deposits, and key deposits beyond a reasonable key fee are illegal. If you collect more than the LMR, the tenant can apply to the LTB using Form T1 to recover the illegal amount plus interest.

You must pay annual interest on the LMR deposit. The interest rate equals the Rent Increase Guideline for that year — for 2025 it is 2.5% and for 2026 it is expected to be announced by the Ministry of Municipal Affairs and Housing in fall 2025. The interest accrues on the anniversary of the deposit and is typically applied as a credit against the final month's rent.

Reporting Rental Income to the CRA

All rental income is taxable under the Income Tax Act. Key CRA reporting points for landlords:

Report net rental income on Form T776 (Statement of Real Estate Rentals)

Deductible expenses include mortgage interest (not principal), property taxes, insurance, repairs and maintenance, property management fees, and advertising

Capital improvements (e.g., a new roof) must be depreciated using Capital Cost Allowance (CCA) — Class 1 for buildings at a 4% declining-balance rate — rather than expensed in the year incurred

• GST/HST does not apply to long-term residential rent, but does apply to commercial rentals and some short-term rentals under 30 days

If you co-own the property, each co-owner reports their proportionate share of income and expenses. The CRA expects consistency between co-owners' returns.

Common Mistakes Ontario Landlords Make with the Standard Lease

Even experienced landlords submit forms to the LTB that have been undermined by avoidable errors. The most consequential pitfalls:

Using an outdated form. The Ministry updated the standard lease in 2024. Using a pre-2024 version is technically non-compliant and could support an LTB application by the tenant.

Listing only the main tenant. If a couple or roommates are moving in together, all adults should be named as tenants. Unnamed occupants have no tenancy agreement and you cannot file an eviction notice against someone not on the lease.

Vague utility descriptions. Writing "hydro included" without specifying the cap (if any) or metering arrangement creates disputes. If you intend to charge for electricity above a threshold, set out the arrangement explicitly in Schedule A or in a separate utility agreement filed alongside the lease.

Entering illegal clauses and thinking they offer protection. A "no pets" clause in Schedule A does not give you grounds to evict a tenant who later gets a pet — RTA s. 14 makes no-pet clauses void. You can act if the pet causes damage or disturbs others.

Forgetting to attach mandatory documents. At signing you must provide: (a) the Information for New Tenants brochure (Ministry of Municipal Affairs and Housing), and (b) if a condo unit, the condo corporation's rules under the Condominium Act, 1998.

• Mishandling the LMR deposit at key return. At move-out, apply the LMR deposit (plus accumulated interest) to the final month. Do not hold it pending inspection — it is not a security deposit and cannot be applied to damages.

Digital Signing, Record-Keeping, and LTB Readiness

The LTB increasingly hears applications supported or rebutted by documentary evidence. Best practice means keeping a complete lease file that includes: the signed standard lease, all Schedule A addenda, photos from the move-in inspection tied to the lease date, proof of delivery of the tenant information brochure, LMR deposit receipt, and any written communications about tenancy terms.

Store these files for at least three years beyond the tenancy end date — the general limitation period under Ontario's Limitations Act, 2002 for most civil claims. For rent arrears proceedings, evidence from the entire tenancy period may be relevant.

If you use a property management platform, ensure it generates a timestamped audit trail for e-signed leases and retains document copies in a format exportable for LTB proceedings, which now accept both in-person and written hearing submissions.

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Bottom line: The Ontario standard lease is not a formality — it is a legally precise document where omissions and errors translate directly into lost rights and LTB exposure. Use the current 2024/2025 Ministry form, populate every section accurately, confine Schedule A to lawful terms, and treat the signed package as your first line of defence at any future hearing. Get this document right at the start, and the entire tenancy is on solid legal ground.