Last updated: June 7, 2022
What this tool is all about:
This tool lets you get an estimate of what your land transfer tax will be when you purchase a new property.
The land transfer tax is one of the largest closing costs you will need to pay when you purchase a property. The tax rates will vary depending on your location. We built the land transfer tax calculator so you can easily get an estimate of your total land transfer tax so you can prepare for it before your closing date as this cost cannot be rolled into your mortgage.
By plugging in information on your property value, downpayment and the location of your new property, you will be provided an estimate of how much your land transfer tax will be. This cost will typically be added to your closing costs. Be sure to speak to your mortgage advisor if you have any questions as this calculator just provides an estimate.
To make this calculator simple to use, we’ve filled in some of the fields already. You can modify each field with your own information to calculate your land transfer tax amount. Try changing different fields to see how it increases or decreases your cost amount.
Property value: Add your current property value, your purchase price, or the estimated purchase price of a listing you’re considering making an offer on.
Downpayment: This is the amount of savings you currently have that can go towards your purchase.
Downpayment (%): This is the percentage of savings you currently have that can go towards your purchase. Your downpayment percentage will also affect your mortgage rate.
City: Depending on the city, there may be different closing costs.
Probably one of the largest closing costs for buyers, the land transfer tax, also known as the property transfer tax, is a one time fee paid to your provincial (and sometimes municipal) government when a property or home is transferred from the seller to you. Tax rates will also vary depending on the province or city your property is located in. In some provinces, the land transfer tax is applied to every home or property once purchased and will depend on the fair market value of the property on the day it was registered with the Land Title Office.
Anyone who purchases a property must pay a land transfer tax to the province in which they bought the property and it must be paid when the transaction closes. Depending on your location, residents might have to pay both provincial and municipal land transfer tax.
Depending on where you are located, if you are a first-time homebuyer, you might be eligible for a land transfer tax rebate. This can either eliminate or reduce the amount of land transfer tax you will have to pay. Keep in mind that each province has different rebate amounts and eligibility criteria as well.
The amount of land transfer tax you will have to pay will depend on your location, as the land transfer tax rate varies in different provinces. In some cases, the land transfer tax can be calculated depending on the purchase price of the property and in other cases it can be based on the fair market value.
No, not all provinces in Canada have land transfer tax. The provinces that have land transfer tax are:
Some areas in Canada will charge both provincial and municipal land transfer tax.
All other remaining provinces and territories charge registration fees based on the value of the property being bought or transferred. These fees are usually much lower compared to typical Canadian land transfer tax rates.
Your lawyer should be the one to help arrange for the payment of the land transfer tax, typically by adding it to your closing costs. In most cases, payment should be made as soon as the property is transferred to your name on closing day. If not, there will be an invoice mailed to your home within the first month, where you will be required to pay the tax in full. Keep in mind that the land transfer tax must be paid in full and cannot be paid in installments, so it’s important that you budget for this accordingly.
No, the land transfer tax is not the same as a sales tax on your home. When you purchase a newly constructed home, there will be a sales tax associated with the purchase. You will have to pay both sales and land transfer taxes.
It’s a rule of thumb to budget at least 2-3% of the purchase price of your property to go towards closing costs (or use our closing cost calculator to get a more exact figure). Land transfer tax cannot be added into your mortgage and must be paid as soon as you take possession of the property from the seller on closing day.
In the process of purchasing a home? Check out Perch’s Guide to Buying a Home at any step of your home buying process to get access to free tools and resources that will help you before and after your closing date. You can also sign up today for a Perch profile to connect with a realtor or mortgage advisor today.
Yes. Our land transfer tax calculator is completely free to use, along with all of our other calculators, rate comparison charts and articles.
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