On these facts the rent increase could not take effect until April 1, 2013 ($1025) . You will note the time period is slightly longer than the required 90 days--this is because the rent increase must take effect on the first day of a new rental period after the 90 days of notice and not in the middle of a rental period---i.e. the tenant, in this example, has paid rent for the entire month of March 2013 on the first of March, therefore you can not raise the rent in the middle of the month.
What if 2.5% is not enough? The simple reality is that the Ontario government has artificially capped the annual guideline amounts at 2.5% and thereby is forcing landlords to absorb the impact of inflation and increasing costs while preventing them from passing on these costs to tenants. The Residential Tenancies Act was changed to cap the guideline amount in June 2012. But for this change in the law, the guideline increase amount in 2013 would be 2.6%.
What can a landlord do if the guideline amount isn't enough? Aside from Above Guideline Increase applications it is increasingly probable that many landlords are renting out units that are exempt from the annual guideline increase caps imposed by the Residential Tenancies Act. The exemptions, for the most part are based on the date that the rental units were built or used for residential purposes. If you have a relatively new rental unit or otherwise want to know if you can avoid the rent increase guideline amounts you should contact a Landlord and Tenant lawyer who can go over all of the ways that your unit might be exempt under the RTA. While a call to the Landlord and Tenant Board may also get you an answer, you should be aware the the language of the exemptions is less than straightforward and the interpretation thereof should be done by an experienced landlord and tenant lawyer.