Ontario land transfer tax calculator

What is the Ontario land transfer tax?

Probably one of the largest closing costs for buyers, the Ontario land transfer tax is a one time fee paid to your provincial government when a property or home is transferred from the seller to you. The Ontario land transfer tax is applied to every home or property once purchased and will depend on the value of the property.

In addition to the provincial land transfer tax, if you are buying a home in Toronto, you will also have to pay a municipal land transfer tax to the city. The boundaries that are defined as Toronto is Steeles Avenue (North), Etobicoke (West), Scarborough (East) and Lake Ontario (South).

Do I have to pay a land transfer tax in Ontario?

Yes. There is some form of land transfer tax that all provinces and territories in Canada have, but the exact amount will depend on the location and will vary. You are required to pay land transfer tax on your property purchase unless you qualify for a rebate/exemption.

What is the purpose of land transfer tax in Ontario?

The land transfer tax is a source of revenue for the provinces that collect them and goes towards paying for public services and infrastructure.

How do I use this Ontario land transfer tax Calculator?

You will need a few key pieces of information, such as your purchase price, down payment and location. This will quickly give you an estimate of your Ontario land transfer taxes, however this is just an estimate and you should work with your advisor to get the exact amount.

How do I estimate Ontario land transfer tax?

The land transfer tax you would have to pay will vary depending on the province you live in. To calculate Ontario land transfer tax, you would need the purchase price of your property and the tax rate. The tax rates based on the purchase price are:

• 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%.

It’s a good idea to budget anywhere from 1-2% of property value just to cover your land transfer taxes, as these will be a part of your closing costs and cannot be rolled into your mortgage.

Here are some land transfer calculations based in Toronto, Ontario (keep in mind this does not include legal fees):

Purchase Price	Land transfer tax	Land transfer tax rebates	Net tax payable
$500,000.00	Municipal LTT: $6,475 Provincial LTT: $6,475	$8,475.00	$4,475.00
$670,000.00	Municipal LTT: $9,875 Provincial LTT: $9,875	$8,475.00	$11,275.00
$750,000.00	Municipal LTT: $11,475 Provincial LTT: $11,475	$8,475.00	$14,275.00
$1,500,000.00	Municipal LTT: $26,475 Provincial LTT: $26,475	$8,475.00	$44,475.00

Who pays the land transfer tax?

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. In Toronto, Ontario, residents will have to pay both provincial and municipal land transfer tax.

How can I avoid the Ontario land transfer tax?

If you are a first-time home buyer in Ontario, you might be able to claim a land transfer tax rebate. If you are buying in Toronto, you might be able to claim a land transfer tax rebate for both your provincial and municipal land transfer taxes.

If you are a first-time buyer in Ontario, you can get a rebate of up to $4,000.00 for the land transfer tax on closing. This rebate can cover the full tax for homes valued up to $368,000. For homes valued above $368,000, you will need to pay the remaining tax beyond the $4,000 rebate. If you are a first-time buyer in Toronto, you can get a rebate of up to $4,475.00 for the municipal land transfer tax (MLTT) on closing.

Your eligibility for this first-time home buyer land transfer tax refund is based on the following:

• You must be a Canadian citizen or permanent resident of Canada
• You must be older than 18 years of age
• You must occupy the home within nine months of purchase
• You cannot have owned a home before in Canada or anywhere else in the world
• Your spouse cannot have owned a home during the course of the marriage
• Newly constructed homes must be eligible for home warranty
• You must apply for the rebate within 18 months after purchasing the property

This rebate does not apply to commercial, industrial or multi-residential properties.

If you are unsure if you are eligible for the first-time home buyer land transfer tax rebate, talk to your lawyer to confirm.

Are there other Ontario land transfer tax exemptions?

When buying real estate in Ontario, there are certain circumstances where an exemption to the Ontario land transfer tax might be granted. This can include:

• Transfer of land between spouses
• Transfer of land from a person to a family business
• Transfer of farming property between family members

Do all provinces in Canada have land transfer tax?

No, not all provinces in Canada have land transfer tax. The provinces that have land transfer tax are:
Alberta
Ontario
Quebec
British Columbia
Manitoba
Saskatchewan
Nova Scotia
New Brunswick
Prince Edward

Few areas in Canada will charge both provincial and municipal land transfer tax. In fact, only three cities in Canada have both: Toronto, Montreal and Halifax.

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.

How do I calculate the Ontario land transfer tax?

Ontario land transfer tax is typically based on the amount paid for the property, in addition to the amount remaining on any mortgage or debt assumed as part of the purchase. The calculation can include the purchase price, liabilities assumed, benefits conferred, soft costs and the cost of upgrades.

Land transfer tax can also be based on the fair market value of the land in certain scenarios.

For example:

• the transfer of a lease with a remaining term that can exceed 50 years
• the transfer of land from a corporation to one of its shareholders
• the transfer of land to a corporation, if shares of the corporation are issued

Ontario Land Transfer Tax Chart

Purchase Price of Property	Marginal Tax Rate
Up to and including $55,000	0.5%
$55,000.01 to $250,000	1%
$250,000.01 to $400,000	1.5%
$400,000.01 to $2,000,000	2%
$2,000,000 and above	2.5%

It’s important to note that each portion of your home’s value is taxed at a unique rate. See below for an example Ontario land transfer tax formula:

• $55,000 first marginal tax bracket
  × 0.50% marginal tax rate
  = $275 land transfer tax


• ($250,000 upper marginal tax bracket – $55,000 lower marginal tax bracket = $195,000)
  × 1.0% marginal tax rate
  = $1,950 land transfer tax


• ($400,000 upper marginal tax bracket – $250,000 lower marginal tax bracket = $150,000)
  × 1.5% marginal tax rate
  = $2,250 land transfer tax


• ($500,000 property value – $400,000 lower marginal tax bracket = $100,000)
  × 2.0% marginal tax rate
  = $2,000 land transfer tax


• $275 + $1,950 + $2,250 + $2,000
  Ontario land transfer tax = $6,475

These calculations can sometimes be confusing, which is why we have created the Ontario land transfer tax calculator. Simply input your details and you’ll instantly get an estimate.

Can the Ontario land transfer tax be rolled into my mortgage?

It’s a rule of thumb to budget around 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.