Land transfer tax is payable on the purchase of property in Ontario. For residential properties, it is
calculated based on the purchase price at the following rates:
- amounts up to and including $55,000: 0.5%
- amounts exceeding $55,000, up to and including $250,000: 1.0%
- amounts exceeding $250,000, up to and including $400,000: 1.5%
- amounts exceeding $400,000: 2.0%
- amounts exceeding $2,000,000, where the land contains one or two single family residences: 2.5%.
In order to qualify for the first time homebuyer land transfer tax refund, a purchaser must satisfy the
following conditions:
- The purchaser cannot have previously owned a home, or an interest in a home, anywhere in the
- world;
- The purchaser’s spouse cannot have owned a home, or an interest in a home, anywhere in the
- world while the purchaser has been married to him or her;
- The purchaser must occupy the home as his or her principal residence within nine months of the
- date of the transfer; and
- The purchaser must be a Canadian citizen or permanent resident.
For transactions completed after January 1, 2017, the maximum land transfer tax refund is $4,000. If the
purchase price is high enough that the total land transfer tax exceeds the refund entitlement, the
purchaser will be responsible for paying the balance of the tax at closing.
Example: A first time homebuyer is purchasing a detached single family dwelling for $550,000.
- Land transfer tax on $550,000 = $7,475
- Land transfer tax less first time homebuyer refund = $7,475 – $4,000 = $3,475
- The purchaser will have to pay the balance of $3,475 at closing
The refund to which a first time homebuyer is entitled will be reduced if the purchaser takes title with
another person who is not a first time homebuyer. The amount of the refund to which the first time
homebuyer will be entitled will depend on his or her interest in the property.
Example: A first time homebuyer is taking title with his parent for the purchase of a $550,000 detached
single family dwelling.
- Child and parent each take ownership as to a 50% share
- Child (first time homebuyer) is entitled to 50% of the $4,000 total refund entitlement
- 50% of $4,000 = $2,000
- Land transfer tax on $550,000 = $7,475
- Land transfer tax less first time homebuyer refund = $7,475 – $2,000 = $5,475
- The purchaser will have to pay the balance of $5,475 at closing
Note: For properties purchased in the City of Toronto, there is also municipal land transfer tax payable
at closing in addition to the Ontario tax. A similar refund is available to first time homebuyers with
respect to the municipal land transfer tax.
Calculate your land transfer tax here
