You've decided to reclaim your rental unit for personal use. You know you need to serve an N12 Notice of Termination. But most landlords discover the hard way that the N12 comes with strict financial obligations — and that the process doesn't end when the notice period runs out.
Here's what happens after you serve the N12, what compensation you're legally required to pay, and how to handle a tenant who refuses to leave.
The Compensation Requirement: Not Optional
Under section 48.1 of the Residential Tenancies Act (as amended by Bill 184), any landlord issuing an N12 for personal use must pay the tenant one month's rent as compensation.
This is a hard legal requirement. There's no discretion. If you don't pay it — or if you pay it late — the tenant can void the N12 entirely and remain in the unit.
How to pay:
You have two options:
- Pay cash compensation — Transfer one month's rent to the tenant no later than the termination date on the N12.
- Waive the last month's rent — Allow the tenant to skip their final month's rent payment. This satisfies the compensation requirement without a cash transfer.
Most landlords choose Option 2. It's simpler, requires no money to change hands, and the result is the same: the tenant has received the equivalent of one month's rent.
Timing matters: Compensation must be paid (or waived) by the termination date. Not before you file. Not at the hearing. By the termination date.
Setting the Right Termination Date
The N12 requires 60 days' notice. But there's a catch most landlords miss: the termination date must fall on the last day of a rental period — not simply 60 days from the date you serve the notice.
Example: Your tenant pays rent on the 1st of each month. You serve the N12 on March 10. The 60-day mark falls on May 9 — but May 9 is not the last day of a rental period. The earliest valid termination date is May 31.
Getting this wrong voids the N12. LTB Ready calculates the correct termination date automatically.
What Happens at the Termination Date
If your tenant pays rent, receives proper notice, and receives the required compensation, the tenancy legally ends on the termination date. If they vacate — you're done.
If they don't vacate, the tenancy doesn't end automatically. You cannot change the locks or remove their belongings. You must apply to the LTB.
If the Tenant Refuses to Leave: Filing the L2
When a tenant doesn't leave after an N12, the next step is filing an L2 Application to End a Tenancy and Evict a Tenant. This asks the LTB to issue an order for possession.
What you'll need:
- A copy of the served N12 (proof of service is important)
- Proof you paid or waived the one-month compensation
- The original termination date from the N12
The L2 is filed through the Tribunals Ontario portal. LTB hearing timelines for N12 cases run 5–9 months from the notice date in most regions.
At the hearing, you'll need to demonstrate the N12 was issued in good faith — that the intended occupant genuinely intends to live in the unit.
The 12-Month Rule: What Happens After You Get Possession
If you obtain an order of possession and the tenant vacates — you now have a legal obligation. Under the RTA, if within 12 months of the termination date you:
- Rent the unit to someone else
- Don't actually move the intended occupant in
- Move them in but then move them out within 12 months
...the former tenant can file a T5 Application alleging bad faith. If the LTB agrees, you could be ordered to pay up to 12 months' rent as additional compensation.
T5 applications are routinely filed, and the LTB's scrutiny of personal use evictions has increased significantly in recent years.
N12 Compliance Checklist
- Qualifying occupant identified (landlord, spouse, child, parent, or caregiver)
- Genuine intent to occupy confirmed
- 60-day notice period calculated correctly (termination date = last day of rental period)
- One month's compensation paid or last month's rent waived by termination date
- L2 filed if tenant remains after termination date
- Intended occupant moves in within reasonable time after possession
LTB Ready's N12 wizard walks you through termination date calculation, compensation disclosure, and generates a completed notice. Paralegals charge $200–$600 for N12 prep. LTB Ready starts at $19.