Sean Willis

Chief Evangelist & Sales Representative

Posted on May 28, 2016 in Real Estate Advice

0 comments

When you buy a home in Ontario (especially Toronto), you’re going to need to be ready to pay the lovely Land Transfer Tax.

 

Who Pays Land Transfer Tax?

When you buy a house or condo in Ontario, the buyer always pays the land transfer tax – Sellers never pay.  On closing day, when the deed to your new property is transferred into your name, your lawyer will arrange for the taxes to be paid.

In Toronto, buyers can look forward to paying Toronto Land Transfer Tax.  This second tax is only paid by buyers who have a postal code in Toronto proper. While this tax has been a bone of contention with Toronto residents and politicians, it’s something we do see going away. At least not any time soon.

On the brightside, first time buyers may be eligible to receive a refund for land transfer tax. Click to learn more about the Land Transfer Tax Refund Program

How much is land transfer tax in Toronto and Ontario?

Toronto and Ontario land transfer taxes are based on incremental percentages based on the value of your home. While we explain how it works below, it’s easier to just use our Land Transfer Tax Calculator.

 

Ontario Land Transfer Tax:
0.5% – on the first $55,000
1.0% – on portion between $55,000 – $250,000
1.5% – on balance over $250,000
2.0% – on anything over $400,000

Qualifying first time buyers receive up to a $2000 credit

 

Toronto Land Transfer Tax:
0.5% – on the first $55,000
1.0% – on portion between $55,000 – $400,000
2.0% – on anything over $400,000
First time buyers are exempt on the first $400,000

 

Painful? We know. That’s why we recommend using the calculator.

Now that you know the scoop, if you’re planning on buying a house or condo in Toronto, make sure that you budget for land transfer tax!

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