Land Transfer Tax

Currently, the land transfer tax in Ontario is as follows:

.5% on the first $55,000
1.0% on portion between $55,000-$250,000
1.5% on balance over $250,000

*If the land falls under the definition of single-family and duplex residences, an additional tax of 0.5% applies to consideration over $400,000.

Example:

A single-family home is purchased for $450,000.
The following calculation applies:

$0-$55,000 .005 x $ 55,000 = 275
$55,000-$250,000 .01 x $195,000 =1,950
$250,000-$400,000 .015 x $150,000 =2,250
$400,000 plus (.015 + .005) x $50,000 =1,000
------
Land Transfer Tax Payable $5,475

Rebate:

Effective May 8, 1996, first time purchasers of newly-constructed homes were eligible for a refund of land transfer tax, until March 31, 1997. The deadline was subsequently extended through successive years and, as of the year 2000, is now extended indefinitely.

Persons qualifying include individuals 18 years of age or older, who have not owned an interest in a home anywhere in the world while he/she was a spouse of the individual. (Home means an eligible home as defined in the Ontario Home ownership Savings Plan Act.)

In order to qualify for a refund the first time buyer must be purchasing a newly constructed home or an interest in a newly constructed home. A newly constructed home is one in respect of which the first time purchaser is entitled to a warranty under Section 13 of the Ontario New Homes Warranties Plan Act and which is sold to the first time purchaser by a vendor as defined in that Act. This newly constructed home must also be used as the principal residence of the first time purchaser.

Reference:

Contact the Ministry of Finance at 1-800-263-7965 for up-to-date information concerning the land transfer tax refund and for additional information concerning non-resident property owners involved with tax deferrals based on 20% tax rate paid on or before May 6, 1997.

• Land Transfer Tax Calculator