Who pays land transfer tax?
When you acquire land or a beneficial interest in land, you pay land transfer tax to the province when the transaction closes. Your lawyer will usually collect this tax and pay it directly to the Ontario goverment.
Buyers of houses, condos and commercial property 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.
How much is land transfer tax in Toronto and Ontario?
Toronto and Ontario land transfer taxes are based on a sliding scale. Below is the scale on how the tax is calculated. You can also use our land transfer tax calculator by clicking here
- 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% up to and including the first $55,000
- 1% of the value which exceeds $55,000 up to and including $250,000
- 1.5% of the value between $250,000 and $400,000
- 2% of the value between $400,000 and $2,000,000
- 2.5% of the value over $2,000,000
Confused yet? Yeah, that’s why we have the calculator. To find out what your land transfer tax could be on a purchase click here
Anyway, if you’re planning on buying a house, condo or commercial property in Ontario, make sure you’ve budgeted for land transfer tax!
Providing additional information
On April 24, 2017, the province began collecting additional information to better understand trends in the housing market through the land transfer tax system. This additional data will be used for the administration and enforcement of the Land Transfer Tax Act, and to support evidence based policy development with respect to Ontario's real estate market
First‑time homebuyers
If you are a first‑time homebuyer, you may be eligible for a refund of all or part of the land transfer tax. Click here for more info on first time buyers rules regarding land transfer tax.
Other land taxes
The Non-Resident Speculation Tax (NRST) is a 15 per cent tax on the purchase or acquisition of an interest in residential property located in the Greater Golden Horseshoe Region by individuals who are not citizens or permanent residents of Canada or by foreign corporations (foreign entities) and taxable trustees. Click here for more info.
Harmonized sales tax
The harmonized sales tax (HST) applies to newly constructed homes or substantially renovated homes, but does not apply to resale homes. Buyers of new homes may receive a rebate of up to $24,000 of the provincial portion (8%) of the HST. If you have any questions about the HST rebate please contact the Canada Revenue Agency at 1‑800‑959‑1953.
Paying the tax
Ontario's land transfer tax is payable when the transfer is registered.
If the transfer is not registered within 30 days of closing, you must submit a Return on the Acquisition of a Beneficial Interest in Land form to the Ministry of Finance, along with the payment of tax within 30 days after the closing date.
Some person(s) do not pay land transfer tax on certain transfers of land. The exemptions include, but are not limited to:
- certain transfers between spouses
- certain transfers from an individual to his or her family business corporation
- certain transfers of farmed land between family members
- certain transfers of a life lease from a non‑profit organization or a charity.
A deferral of land transfer tax may be available when land is transferred between affiliated corporations, and notice of the transfer is not registered on title.