LAND TRANSFER TAX
Land transfer tax (LTT) is often overlooked when considering the total cost of purchasing a home. All provinces have a land transfer tax, except Alberta and Saskatchewan, who instead levy a much smaller transfer fee. In most provinces the tax is calculated as a percentage of property value, using asking price as a close estimate. Homebuyers in Toronto, however, also incur an additional municipal tax.
What is Land Transfer Tax?
Anytime a property is purchased and sold in Ontario, the buyer must pay a Land Transfer Tax. Don’t be misled by the name Land Transfer Tax — in reality, it is more like a property transfer tax.
Homes, townhomes, condos, pre-construction condos, buildings, and, of course, land are all subject to Land Transfer Tax in Ontario. For those of you who are buying real estate in Toronto, you will pay both Land Transfer Tax Ontario (provincial) and Land Transfer Tax Toronto (municipal).
The price we pay to keep our beautiful city thriving!
Who Pays Land Transfer Tax & When?
The purchaser of the property will pay Land Transfer Tax on the closing date of the property. A seller is never subject to Land Transfer Tax.
On a resale property, the closing date is shortly after the offer has been accepted. This can be a few days or a few weeks.
On a pre-construction property, the closing date is typically three to four years later when the building is complete. Purchasers will be notified minimum 21 days ahead of the closing date to prepare their closing expenses and other finances.
How is Land Transfer Tax Calculated?
The amount of Land Transfer Tax owed will depend on the purchase price of the property. As mentioned before, any properties purchased in Toronto are subject to both municipal and provincial Land Transfer Tax.
How is Land Transfer Tax Calculated?
The amount of Land Transfer Tax owed will depend on the purchase price of the property. As mentioned before, any properties purchased in Toronto are subject to both municipal and provincial Land Transfer Tax.
Rates for Land Transfer Tax Ontario 2019:
Up to and including $55,000: 0.5%
$55,000 up to and including $250,000: 1.0%
$250,000 up to and including $400,000: 1.5%
$400,000 to $2,000,000: 2.0%
Over $2,000,000: 2.5%
Rates for Toronto Land Transfer Tax 2019:
Up to and including $55,000: 0.5%
$55,000 up to and including $250,000: 1.0%
$250,000 up to and including $400,000: 1.5%
$400,000 to $2,000,000: 2.0%
Over $2,000,000: 2.5%