Land Transfer Tax

Home buyers in most large Canadian centres have to add Land Transfer Taxes ("LTT") to their list of closing costs. Unless you live in Alberta, Saskatchewan, or rural Nova Scotia, Land Transfer Taxes (or property purchase taxes) are a basic fact of life.

Land Transfer Taxes, levied on properties changing hands, are the responsibility of the purchaser. Depending on where you live, the taxes can range from 0.5% to 2.5% of the total value of the property.

Many provinces have multi-tiered taxation systems and these can be complicated. If you purchase a property for $260,000 in Ontario, for example, 0.5% is charged on the first $55,000; 1% is charged on $55,000 to $250,000, and 1.5% is charged on $250,000 to $400,000.

In Ontario first-time home buyers of new homes may be eligible for a rebate of the Land Transfer Tax!

The following sections are designed to help you to calculate land transfer tax in Ontario. Please note: The calculations provided on this page and the Land Transfer Tax Calculator are provided for informational purposes only. I recommend that you consult with a professional in order to determine the actual amount of LTT you will be required to pay. (i.e. your agent, lawyer or banker).

Effective April 21, 2017, a 15% Non-Resident Speculation Tax is imposed on the purchase or acquisition of an interest in residential property located in the Greater Golden Horseshoe by individuals who are not citizens or permanent residents of Canada or by foreign corporations (foreign entities) or taxable trustees. This new tax is in addition to Ontario's current Land Transfer Tax.

To calculate the total Ontario Land Transfer Tax for the purchase of Residential properties in Ontario, add the following together:

• 0.5% on the first $55,000 of the purchase price
• 1.0% of the amount from $55,000 to $250,000
• 1.5% of the amount in excess of $250,001 to $400,000
• 2.0% of the amount in excess of $400,000 to $2,000,000
• 2.5% of the amount in excess of $2,000,000

OR use table below as your guide.

OR use the Land Transfer Tax Calculator to estimate the LTT on the purchase of your Residential property.

To calculate the total Ontario Land Transfer Tax for the purchase of Commercial properties in Ontario, add the following together:

• 0.5% on the first $55,000 of the purchase price
• 1.0% of the amount from $55,000 to $250,000
• 1.5% of the amount in excess of $250,001 to $400,000
• 2.0% of the amount in excess of $400,000 to $2,000,000
• 2.5% of the amount in excess of $2,000,000

OR use table below as your guide.

OR use the Land Transfer Tax Calculator to estimate the LTT on the purchase of your Commercial property.

First-time home buyers may be eligible for a refund of all or part of the tax payable.

• For agreements of purchase and sale entered into before December 14, 2007, the refund only applies on the purchase of a newly constructed home.
• For agreements of purchase and sale entered into after December 13, 2007, the refund applies to all homes, whether newly constructed or resale.

The requirements in order to qualify for the refund of the land transfer tax for a first-time home buyer are as follows:

• The purchaser must be at least 18 years old
• Application for refund must be made within 18 months after the date of conveyance or disposition
• The purchaser must occupy the home as his or her principle residence within 9 months of the date of conveyance or disposition
• The purchaser cannot have previously owned a home, or an interest in a home anywhere in the world
• A spouse or same-sex partner of the purchaser cannot have owned a home, or an interest in a home, anywhere while the spouse or same-sex partner of the first-time purchaser
• The purchaser cannot have received an Ontario Home Ownership Savings Plan (OHOSP) based refund of land transfer tax

To apply for the refund, a Refund Affidavit should be presented to the Registrar and if properly completed, the refund amount will be deducted from the tax ordinarily payable.

For further information, please refer to the Ontario Ministry of Finance page: Ontario Tax Bulletin LTT 2-2005 and Ontario Tax Bulletin LTT 1-2008.