Does the municipal vacant home tax apply to a property I own but let a family member live in for free?

Generally, no - a property isn't automatically treated as vacant just because a family member lives there rent-free rather than paying rent. Occupation by a permitted occupant, which can include a family member, for the required period typically satisfies the occupancy requirement under these municipal programs even without any money changing hands, since the point of the tax is to catch genuinely vacant or underused housing, not housing that's actually being lived in.

That said, the specific rules and documentation required to support this differ somewhat between cities, and simply asserting that a relative lives there isn't always enough on its own - you may need to show things like the family member's identification tied to that address, or other evidence supporting genuine occupancy, particularly if the city asks questions about the declaration. Because the definitions of "permitted occupant" and the exact evidence expected can vary between Toronto's and Ottawa's programs and get updated periodically, it's worth confirming the current requirements for whichever city's program applies to your property, rather than assuming a family member living there rent-free automatically and permanently satisfies the exemption without any supporting documentation.