Quebec's Simplified Rent Increase Method: How the TAL Now Calculates Rent Adjustments

Before 2026, the TAL set percentages each year for a set of cost components: electricity, gas and heating oil, maintenance, building services, personal services, management and net income, with a separate rate for capital expenditures. The 2025 release says capital spending was tied to the average interest rate of Canadian trust companies increased by 1%.

[Cite: Tribunal administratif du logement, 2025 rent-fixing release (January 21, 2025); TAL, "Applicable percentages"]

Because those components are specific to each building, the TAL describes every calculation as specific to the building or dwelling concerned.

[Cite: Tribunal administratif du logement, "Applicable percentages"]

The TAL's summary of the regulatory changes lists four criteria. The general CPI for Quebec, averaged over three years, indexes the base rent. Municipal and school taxes allow a supplementary adjustment when they rise by more than the base percentage. Insurance works the same way. Capital expenditures are counted at a fixed 5%.

[Cite: Tribunal administratif du logement, summary of regulatory changes (December 2025)]

Éducaloi describes the method as five factors, including expenses for new services and accessories. A news report of the April 2025 announcement describes four. The TAL's own summary lists four plus a separate indexing for personal services in seniors' residences, so the difference appears to be how the new-services item is counted.

[Cite: Éducaloi, "A New Way of Calculating Rent Increases"; CBC News, "After biggest rent hike in decades, Quebec changing method to calculate it"]

The base is the three-year CPI average, which the TAL set at 3.1% for notices given in 2026. Taxes and insurance count only where they rose by more than 3.1%, and amounts below that are disregarded. Public subsidies related to new services, taxes and insurance are deducted, and when such aid ends or changes, the resulting cost is considered.

[Cite: Tribunal administratif du logement, "Applicable percentages"; Bernier Fournier Avocats, "Augmentation de loyer en 2026 au Québec"; Gouvernement du Québec, memorandum to the Conseil des ministres (2025-0143)]

The memorandum describes a simplification meant to reduce disputes and tribunal applications, though it does not quantify the effect.

[Cite: Gouvernement du Québec, memorandum to the Conseil des ministres (2025-0143)]

For seniors' residences, the rent is split between the base rent and person-related services. The base rent is indexed with the general CPI. The services portion is indexed with the healthcare component of the CPI, again on a three-year average. A notice has to show the amount or percentage of the increase for the services portion.

[Cite: Tribunal administratif du logement, summary of regulatory changes (December 2025); Gouvernement du Québec, memorandum (2025-0143)]

The TAL states that the earlier method applies to notices given before January 1, 2026, even if the rent adjustment takes effect after that date. A landlord who gave a July 2026 renewal notice in December 2025 is therefore on the old method. One who gave it in January 2026 is on the new.

[Cite: Tribunal administratif du logement, summary of regulatory changes (December 2025)]

The notice process works as before. For a lease of 12 months or more, notice goes out 3 to 6 months before the end date. The tenant has one month to accept, refuse or leave, and silence counts as acceptance. A landlord whose increase is refused has one month to apply to the TAL.

[Cite: OACIQ, "Lease renewal and modification"; TAL form 819A-E]

The government announced the new method on April 16, 2025, through the Official Gazette, according to CBC. The report said the 2025 increase of 5.9% stood and that the new method would have produced 4.5% had it applied that year. The Regroupement des comités logement et associations de locataires du Québec called the change a missed opportunity to curb the housing crisis.

[Cite: CBC News, "After biggest rent hike in decades, Quebec changing method to calculate it"]

The regulation's formal title and Gazette citation were not confirmed in the sources reviewed, so a landlord who needs to cite it should take the reference from the Gazette officielle du Québec.

Check the date on every pending renewal notice, because the dividing line is the date the notice was given and not the date the rent changes. Rebuild the calculation sheet around the four criteria and retire the old component lines for 2026 notices.

For taxes and insurance, record the actual percentage increase for each building and compare it with the base, since only the excess counts. Keep invoices and subsidy letters with the file, because a refused increase at the TAL turns on those documents.