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One of the least fun parts of buying a home in Ontario, and especially in Toronto, is paying Land Transfer Tax.

Who pays land transfer tax?

Buyers of houses and condos in Ontario pay land transfer tax when they purchase a property – Sellers never pay. Your lawyer will arrange for land transfer taxes to be paid when the deed to the new home is transferred in your name (on closing day). Buyers in Toronto are especially unlucky – we also get to pay the Toronto  Land Transfer Tax.

Some good news for first-time buyers is that they may be eligible to receive a refund for land-transfer tax – click here for details of the Land Transfer Tax Refund Program.

How much are Land Transfer Taxes in Toronto and Ontario?

Toronto and Ontario land transfer taxes are based on a sliding scale, though to be honest, it’s much easier to just use our Land Transfer Calculator:

Ontario Land Transfer Tax:

  • 0.5% of the value of the property up to and including $55,000
  • 1% of the value which exceeds $55,000 up to and including $250,000
  • 1.5% of the value which exceeds $250,000 up to and including $400,000
  • 2% of the value between $400,000 and $2,000,000
  • 2.5% for amounts exceeding $2,000,000, where the land contains one or two single-family residences

Toronto Land Transfer Tax:

  • 0.5% of the first $55,000
  • 1% of the value between $55,000-$250,000
  • 1.5% of the value between $250,000 to $400,000
  • 2% of the value between $400,000-$2,000,000
  • 2.5% of the value between $2,000,000-$3,000,000
  • 3.5% of the value between $3,000,0000-$4,000,000
  • 4.5% of the value between $4,000,000-$5,000,000
  • 5.5% of the value between $5,000,000-$10,000,000
  • 6.5% of the value between $10,000,000-$20,000,000
  • 7.5% on the value above $20,000,000

Confused yet? Yeah, that’s why we have the calculator.

Anyway, if you’re planning on buying a house or condo in Toronto, make sure you’ve budgeted for land transfer tax!

Comments

  1. Logan says:

    I think you should mention the mayor who first proposed the Toronto land transfer tax along with many additional deficit enhancing measures.

  2. Luka says:

    So, if you take occupancy of a condo which isn’t registered yet, you don’t pay the land transfer until final closing at which point you take title, correct?

    • Melanie Piche says:

      Correct! You’ll start to pay occupancy costs to the builder but won’t actually own it until the final closing when you take title, get your mortgage and pay land transfer tax.

  3. Dragos says:

    I bought from the builder a brand new town home in York region, Ontario and the possession date is December 2013, do I need to pay the land transfer tax at the closing date ?

    Regards.

    • Melanie Piche says:

      Land transfer tax is payable on the actual closing date, which may or may not be the date you take possession. With many new construction projects, there is an interim occupancy period – you get to live in the property but are paying the builder ‘rent’ to live there’. When the property actually closes (you get a mortgage and deed to the property), you would pay land transfer tax.

    • Melanie Piche says:

      Property tax (and land transfer tax) is based on the estimated value of the home (and bigger lots tend to be more expensive).

        • Brendan Powell says:

          Land Transfer Tax is only payable when you buy property. If no property is changing hands (e.g. if you build a house on an existing piece of land), then no property is changing hands and there will be no land transfer tax–emphasis on the TRANSFER part!

  5. Rena says:

    My boyfriend and I bought a house last year, and titled as joined tenant. Now we are going to separate and I agree take over all interest from him. But our lawyer said I need pay land transfer tax again? Is it true?

    • Melanie Piche says:

      Unfortunately, a lawyer would be the right person to give you guidance on this, this isn’t a typical situation. I sure hope that’s not the case though, good luck!

  6. Carlos Hernandez says:

    I am a homeowner and I have to plan to sell and buy another Home my question is Do I have to Pay Land transfer Tax..

    • Melanie Piche says:

      You’ll need to pay land transfer tax on your purchase…the person who buys your current house will pay it on that transaction.

  7. Mike says:

    I purchased a condo for the first time but i am renting it out. Am I able to get the credit. My lawyer put that i will move into the condo within 9 months. what will happen if i dont move in?

    • Melanie Piche says:

      You should confirm that with your lawyer, but you don’t normally get a land transfer credit for an investment.

  8. Jeff says:

    I bought my condo before I met my wife. She has never owned property before and her name isn’t on the deed or the mortgage. When we buy our next place is she eligible for the first time home buyers credit?

    Thanks!

  9. Van Thai says:

    Hello,
    what is the difference between land transfer tax and property tax? if my first bought house, I did not apply for a rebate on Land Transfer Tax. Am I still qualify for the rebate when I am buying my 2nd house?
    Thanks,

    • Melanie Piche says:

      Land transfer taxes are paid once, when you take possession of a property. You pay property taxes every year (unfortunately). Your lawyer likely applied for your land transfer tax rebate upon close – it usually happens automatically with the closing costs vs them actually sending you a cheque. You only qualify for the rebate on the first purchase – might be a good idea to check with your lawyer to see what happened last time!

  10. Susan says:

    Our home has been paid off for a couple of years. The Deed was only in my husbands name. He just passed away this year. I went to see my Lawyer to have the Deed only in my name. Will I have to pay a Land Transfer tax?

  11. Susan says:

    I live in Ontario. Our home has been paid off for a couple of years. The Deed was only in my husbands name. He just passed away this year. I went to see my Lawyer to have the Deed only in my name. Will I have to pay a Land Transfer tax?

  12. Tammy says:

    I purchased a place about 7 months ago, and it just closed. However, since I got a job offer in another city, I have to move and rent it out. I’ve never lived inside since the occupancy date is the same as closing date. Although I intended to live there when I initially bought it, but I can no longer do so due to the move. Can I still claim the land transfer tax credit?

    • Melanie Piche says:

      You’ll want to double-check that with your lawyer, but normally you aren’t eligible for land transfer credits for investment properties.

    • Melanie Piche says:

      Yes, the land transfer tax is paid to the local and provincial governments – it has nothing to do with the realtor! When you close a private sale, you’ll need to use a lawyer and the lawyer will handle the land transfer tax remittances.

  14. Lynn says:

    If I buy a condo as a rental property (ie. i am not living in it), my understanding is that I can’t claim the land transfer tax rebate.

    So then, am I able to save that rebate for when I buy a house that I DO plan on living in (which will be much more expensive than the rental condo)?

    Or if I don’t use it on my first house, do I lose it forever?

    • Melanie Piche says:

      Unfortunately you’re right on both counts. You aren’t eligible if it’s an investment property and you aren’t eligible if you’ve ever owned a home, so yes it would be gone forever…

      • CC says:

        Thx Melanie for the Q&As. This one particularly applies to my son and a lot of young buyers who can barely afford the down payment but only to rent out to accumulate some equity. I found it is very unfair and illogical that in this case, their real “first time HOME ownership” benefit will no longer be available to them… really hope someone will take this up with the government some time and benefit the rest of young people !

  15. John says:

    I have owned my home for 10 years. If my fiance is added to the title, do we have to pay property tax? Does it make a difference to wait until after we are married to place her on title? I seem to be finding conflicting information on this. Thank you.

  16. Kao says:

    My fiance and I are planning to purchase a pre-construction unit. If he owned a property already, but I am first time home buyer, are we still eligible to receive the land transfer tax rebate and HST rebate?

    Also, if we are going to purchase a property in Richmond Hill or Vaughan or Markham, do we need to pay Toronto land transfer tax? or only the Ontario tax? Thank you.

    • Melanie Piche says:

      According to the official rules, you aren’t eligible if “you have a spouse, your spouse cannot have owned an eligible home, or an interest in an eligible home, anywhere in the world while being your spouse.” So it really depends on when he owned it…your lawyer should be able to advise about your specific situation. But good news: you only need to pay Toronto land transfer tax if you buy in Toronto!

  17. paul mcfadyen says:

    both of my mom and dad have passed away . they have a 160 acre piece of land up north . ? it is still in their name ,and I have been paying the property tax on it . to have the land transferred to my name will I have to pay land tax and capital gains on it.

  18. Dev says:

    When you Buy a condo, Land is not transferred in the buyer’s name, but it remain in the name of condominium Corporation. Why the land transfer tax is charged to buyer of a condo

    • Melanie Piche says:

      That’s a good question for the government! A deed to a property is still transferred to you when you buy a condo, so while it isn’t ‘land’ exactly, it’s still owned.

  19. Siva says:

    If you are selling a property, if the buyer wants to trade the property to your selling property and pay the difference, do you still have to pay the land transfer tax? In this situation, do they both need to pay land transfer tax?

    • Melanie Piche says:

      Check with a lawyer, but the properties are changing ownership so I don’t see any reason why you each wouldn’t have to pay land transfer tax on the property you are buying.

  21. Steve says:

    Is the Land Transfer Tax calculated on the MPAC assessment (ie. on the property tax bill) or is it the actual sale/purchase price of the property?

  22. Linda says:

    I want to be taken off title for a home I own with my sister. This is a principal residence for us both. No money will be exchanged. Would Land Transfer Tax payable?

  23. Tina says:

    In Ontario, when purchasing a condo does HST get charged on the land transfer tax amount? If it does, this would appear to be a tax on a tax.

  24. Sid says:

    Hi Melanie,

    Great article! Does the land transfer tax refund cover both the Ontario AND Toronto land transfer taxes? I will be a first-time buyer, and that would definitely help me out.

    Thanks, and this is a very useful site, I find.

  25. Chandra says:

    Hello Melanie, If I have owned just an empty land (no house in it), am I eligible for property transfer tax rebate? The official site only talks about the house though not land.

    • Melanie Piche says:

      I don’t believe land transfer tax or the rebates depend on a house actually being built on that land, but I’d suggest you get in touch with your real estate lawyer to confirm.

  26. Pingback: Thinking about Canadian Real Estate after Trump’s win? – Nest Seekers International Blog
  27. Mila says:

    I am a first time buyer and the condo that I purchased have tenant for the next 3 months. Am I still eligible to get land transfer tax back. I am not sure if after I will move in or look for another tenant.

  28. Mila says:

    I am a first time buyer of a condo with tenant in for 3 months after I take possession. Do I still qualify for land transfer tax back.

  29. Aurelia Dumitrescu says:

    I’m a first time home buyer and I am aware of all the procedures to get the rebate for the land transfer tax. I called few lawyers and they told me that I must pay the land transfer tax at closing together with all other lawyer’s charges and I need to apply for the rebate, however one lawyer advised that I don’t have to pay for the land transfer tax at closing since I’m first time home buyer. My question is.. is it mandatory to pay for the land transfer at closing or every lawyer may handle this different and choose to not charge us for land transfer at closing? Thank you very much

  30. Doug Lake says:

    Land transfer tax is not a sales tax. It is a tax on wealth and should be stopped. It adds years to paying off a mortgage. It adds about 40% on top of the 10% down payment and makes it very hard for people to buy a first home.

  31. Helen says:

    If I buy a new home for the investor, the purchase price is 350k after the upgrade is 370k and I put it together in the mortgage. What do I pay for the HST tax and land transfer, the purchase price or after the price upgrade?
    Thank you for your help.

  32. judy desroches says:

    If I co-sign on my daughter’s mortgage, not a first time home buyer, am I subject to land transfer tax, and is it pro-rated to the three of us on title? Also, what amount will the tax be calculated, since there is no actual sale, only a new mortgage put on the same property they have occupied for 3 years?
    Thank you.

  33. James Ho says:

    I’m a Canadian citizen living abroad for over 20 years. Is the 15% non resident tax when buying a condo in Toronto applies to my situation?
    Is the non resident tax payable only when the deal closes? If it’s a new development, I would pay the non resident tax when the new development finishes, & I take ownership of the new condo?
    For a Canadian citizen who has been living abroad, how could I establish my residency in Canada?
    Is this nonresident tax only applies in Toronto/ Ontario? but not in Vancouver?

    Thank so much for your help.

    Sincerely yours,
    James Ho

    • Melanie Piche says:

      If you’re a citizen, you won’t be subject to the non-resident tax. As a non-resident citizen though, you’ll be subject to stiffer financing rules. Vancouver also has a non-resident tax (and a tax on vacant homes).

    • Brendan Powell says:

      Property taxes in Toronto are a yearly cost, but can be paid in any number of installments; some pay monthly, some all in one go, and others quarterly. It’s up to you.

      • Brendan Powell says:

        But keep in mind this blog is about LAND TRANSFER taxes, which are different. Those are a one-time cost when you buy a property, and completely separate from yearly property taxes.

  35. Meagan Murdoch says:

    Does anyone know if it’s an automatic rebate or do you have to pay the total cost as a First time home buyer and then get the refund later?

  36. Eddy Joya says:

    Hi I am a first time home buyer and looking to buy a property. Based on my income I don’t qualify for amount of mortgage I plan on applying. My cousin is becoming a cosigner and his name will be on mortgage. My cousin already has a property. In this case would I be eligible for first time home buyer incentive for land transfer tax? Thanks

  37. Jeremy says:

    Hello.
    I own my condo and that was before I married my wife. We bought a house together and we are planning to keep the condo for income. Can my wife get some kind of rebate for buying our new house? She never owed a property before

    • Brendan Powell says:

      Yes as I understand it you can claim a refund in the proportion to which you own the new house—as long as the home you bought was before you were married. Confirm as always with your lawyer.

      Here is the relevant section from the CRA in the link above:

      “A qualifying purchaser may also claim a refund in proportion to his or her spouse’s interest if that purchaser’s spouse has owned a home before becoming the purchaser’s spouse, but not while being that purchaser’s spouse.”

  38. Darlene says:

    I paid the land transfer tax on a house that was gifted to me in 2009 and I never owned a house before, which means I should have been eligible for the refund but was never told it even existed. Isn’t it the lawyers job to inform their client that they are eligle for a refund???

    • Brendan Powell says:

      As I understand it, if you are an eligible first time buyer, then you would be entitled to the land transfer tax REBATE, (not a refund)—meaning you do not pay it and then get $ back…you simply pay less in the first place. Yes, typically your lawyer would apply that and yes, typically that would be a question your lawyer would ask as part of the transaction.
      If you are unsure whether the rebate was applied you should speak to your lawyer, however it may have simply been applied without you realizing, as there is no actual refund per se.

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