In general, if you buy land or an interest in land in Ontario, you must pay Ontario’s land transfer tax, whether or not the transfer is registered at one of Ontario’s land registry office.
Land includes any buildings, buildings to be constructed, and fixtures (such as light fixtures, built-in appliances and cabinetry).
The land transfer tax payable is normally based on the amount paid for the land, in addition to the amount remaining on any mortgage or debt assumed as part of the arrangement to buy the land.
Each province has a different land transfer tax rate, in addition, many province has also implemented Municipal Land Transfer Tax which can be complicated to understand.
In Ontario, the provincial land transfer tax since June 1st, 1989 is as follow:
- 0.5% of the value of the consideration up to and including $55,000,
- 1% of the value of the consideration which exceeds $55,000 up to and including $250,000, and
- 1.5% of the value of the consideration which exceeds $250,000, and
- 2% of the amount by which the value of the consideration exceeds $400,000 for land that contains at least one and not more than two single family residences.
Toronto City Council approved a new Municipal Land Transfer Tax effective February 1, 2008 that will be applied to purchases on all properties in the city of Toronto in addition to the Province’s Land Transfer Tax.
Toronto Municipal Land Transfer Tax Rates
For property containing at least one, and not more than two, single family residences with a consideration value of:
- 0.5% of the value of the consideration up to and including $55,000, plus
- 1% of the value of the consideration which exceeds $55,000 up to and including $400,000, plus
- 2.0% of the amount by which the value of the consideration exceeds $400,000
For all other properties:
- 0.5% of the value of the consideration up to and including $55,000, plus
- 1% of the value of the consideration which exceeds $55,000 up to and including $400,000, plus
- 1.5% of the value of the consideration which exceeds $400,000 up to and including $40,000,000, plus
- 1.0% of the amount by which the value of the consideration exceeds $40,000,000
You are eligible for a Municipal Land Transfer Tax rebate if:
A. The Agreement of Purchase & Sale was executed on or before December 31, 2007 and the closing date is on or after February 1, 2008. In this case you will be eligible for a full rebate.
B. You are a first-time purchaser of a newly constructed or re-sale residential property. The rebate for first-time home purchasers is up to a maximum of $3,725.00.
Together, we’re building a great city. Toronto Land Transfer Tax is stopping us from reaching out full potential. Take a minute to tell your city councilor that you oppose the Toronto Land Transfer Tax.
