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Ontario Land Transfer Tax
When you a buy a house, condo or land in Ontario you are subject to land transfer tax which is due upon closing. Use RateHub’s calculator to determine your applicable land transfer tax or view Ontario's 2016 rates below and follow along with our sample calculation.
Ontario land transfer tax calculator
Land transfer tax rates in Ontario – Updated in 20161
The Ontario land transfer tax (LTT) is a marginal tax and each portion of your home’s value is taxed at a unique rate. These tax rates are as follows:
| Purchase price of home | Land title transfer fee | First-time home buyer rebate |
|---|---|---|
| First $55,000 | 0.5% | The Ontario first-time home buyer rebate covers the full land transfer tax up to a maximum of $4,000. It is only available to first time home buyers. |
| On $55,000 to $250,000 | 1.0% | |
| On $250,001 to $400,000 | 1.5% | |
| On $400,001 to $2,000,000 | 2.0% | |
| Over $2,000,000 | 2.5% |
If you are purchasing a home in Toronto, it is important to note that an additional Toronto Land Transfer Tax will also apply. Beyond the land transfer tax you will also have to pay closing costs in Ontario when purchasing a home. These closing costs could include fees for an Ontario real estate lawyer and Ontario home inspector.
Example Ontario land transfer tax calculation2
Let’s assume that you are purchasing a house for $300,000:
Ontario land transfer tax calculation
$55,000
first marginal tax bracket
0.50%
tax rate
=
$275
land transfer tax
( $250,000
upper marginal tax bracket
$55,000
lower marginal tax bracket)
1.00%
marginal tax rate
=
$1,950
land transfer tax
( $300,000
property value
$250,000
lower marginal tax bracket)
1.50%
marginal tax rate
=
$750
land transfer tax
$275
land transfer tax
$1,950
land transfer tax
$750
land transfer tax
=
$2,975
total land transfer tax
Ontario land transfer tax rebate in Ontario
For first time home buyers, there is a maximum $4,000 tax rebate on the Ontario land transfer tax. Based on Ontario’s land transfer tax rates, this rebate will cover the full tax for homes worth up to $227,500. For homes worth more than $227,500, buyers will only receive the full $4,000 rebate.
For Example:
| Purchase price of home | Land title transfer tax | First-time home buyer rebate | Net tax payable |
|---|---|---|---|
| $100,000 | $725 | $725 | $0 |
| $200,000 | $1,725 | $1,725 | $0 |
| $227,500 | $2,000 | $2,000 | $0 |
| $600,000 | $8,475 | $4,000 | $4,475 |
First-time home buyer eligibility in Ontario
- You must be 18 years or older.
- You must occupy the home within 9 months of purchase.
- You cannot have owned a home or interest in a home anywhere in the world.
- Your spouse cannot have owned a home while being your spouse (but may be a previous home owner).
- If the home is newly constructed, it must be eligible for home warranty.
- Home buyers must apply for the refund within 18 months of purchase.
Application
Taxpayers can claim an immediate refund when registering the land transfer papers and paying their taxes. Tax rebate application forms are available online for home buyers registering electronically or on paper at government offices.
If the rebate is not claimed at the time of registration, the full tax is paid and a refund claim can be made to the Ministry of Finance within 18 months. Information required for the application include:
- A completed Ontario Land Transfer Tax Refund Affidavit for First-Time Purchasers of Eligible homes.
- A copy of the registered land transfer deed.
- A copy of the agreement of purchase and sale
- A copy of a document that provides proof of residence, such as a driver’s license, telephone/cable bills, etc.