Calculating Your Land Transfer Tax

Posted: October 20, 2009 in Buyers, General Information

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There always seems to be plenty of confusion surrounding the topic of  calculating land transfer tax. Let us begin with the Ontario Government Land Transfer Tax.  This tax applies to all residential real estate property in Ontario.  In the case of new homes purchased from the builder, the tax is payable on the amount before GST.  The tax is payable upon closing and is calculated as follows:

0.5% on the first $55,000 of the purchase price, plus;
1.0% on the amount exceeding $55,000 up to and including $250,000, plus;
1.5% on the amount exceeding $250,000 up to and including $400,000, plus;
2.0% on the amount exceeding $400,000.

Rebates on the Ontario LTT are available for first time buyers only.  To qualify you, and your spouse if applicable, must be at least 18 years of age and must have never owned an interest in a home anywhere in the world (since you became spouses).  If one of you or your spouse owned a home prior to being married and sold that that home prior to marriage, the other spouse may claim the entire refund, even in the case of a home owned jointly.  If two non-spouses purchase a home with 50/50 interest, where only one purchaser qualifies as a first time buyer, that buyer may reclaim 50% of the rebate.  The total rebate is capped at $2,000, in any case.

 The Ontario LTT rebate now applies to both new and resale homes

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