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LAND TRANSFER TAX ONTARIO

Written by Jeremy Van Caulart

What is Land Transfer Tax, and How is it Calculated in Ontario?

If you’re thinking about buying a home in Toronto, Ontario, you’ve likely heard of land transfer tax. In this short post I’ll explain how it’s calculated and give you a few links to resources I find helpful

Overview

Simply put, land transfer tax is a provincial (and municipal in Toronto) tax due on a property when the title changes hands (when a home is sold). The land transfer tax is payable by the buyer (not the seller), and is due when the transfer of title is registered.

This usually happens on closing and is handled by your lawyer.

Calculations

The way the land transfer tax is calculated can be confusing, but luckily there are plenty of calculators and apps available online to help you figure it out. 

Ontario Land Transfer Tax

  • 0.5% of the first $55,000
  • 1% of anything above $55,000 and below $250,000 (included)
  • 1.5% of anything above $250,000 and below $400,000 (included)
  • 2% of anything above $400,000 and below $2,000,000 (included)
  • 2.5% of anything above $2,000,000

Toronto Land Transfer Tax

  • 0.5% of the first $55,000
  • 1% of anything above $55,000.01 and below $250,000 (included)
  • 1.5% of anything above $250,000.01 and below $400,000 (included)
  • 2% of anything above $400,000.01 and below $2,000,000 (included)
  • 2.5% of anything above $2,000,000.01

You’ll notice that Toronto’s municipal land transfer tax is the same as the provincial rates. An easy way to calculate what’s owing is to calculate the provincial and double it.

Here’s a hypothetical breakdown of the land transfer tax on a Toronto condo.

Purchase Price: $600,000
$55,000 * 0.5% = $275
$250,000 – $55,000.01 = $194,999.99 * 1% = $1,949.99
$400,000 – $250,000.01 = $149,999.99 * 1.5% = $2,249.99
$600,000 – $400,000.01 = $199,999.99 * 2% = $3,999.99

$8,474.97 rounded to $8,475 * 2 (adding Toronto’s municipal tax) = $16,950 Total

I’ve included an LTT calculator below to save you the pain of having the calculate this yourself.

Ontario Land Transfer Tax Calculator

 
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