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Ontario Land Transfer Tax Explained
The Government of Ontario applies a Land Transfer tax for land that is being transferred from one owner to another. This amount is payable by the purchaser upon registration of the Transfer/Deed. If a first-time purchaser is buying a new home from a registered builder, the first $2,000 in provincial Land Transfer tax is waived.
City of Toronto Land Transfer Tax is extra, as shown below.
Calculations for the Ontario Land Transfer Tax are based on the following:
- The first $55,000 of the purchase price is taxed at a rate of 0.5%,
- $ 55,000 up to and including $250,000 is taxed at an additional rate of 1.0%
- $250,000 up to and including $400,000 is taxed at an additional rate of 1.5%
- over $400,000 on one- or two-family residential properties is taxed at an additional rate of 2%.
(This amount is not applicable to industrial or commercial properties. The tax rate is 1.5% for a purchase price above $250,000)
Example: The purchase price of a single-family residential property = $650,000.
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$55 000 x .005 |
= $275 |
(the first 55 000 is taxed at .5%)
+ plus |
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$195 000 x .01 |
= $1950 |
(the next 195 000 is taxed at 1%)
+ plus |
| $150 000 x .015 |
= $2250 |
(the next 150 000 is taxed at 1.5%)
+ plus |
| $250 000 x .02 |
= $5000 |
(the last 250 000 is taxed at 2%) |
| $650 000 total tax |
= $9475 |
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