Confused about Land Transfer Taxes? Don’t feel bad, a lot of people are! In Toronto things can be even more confusing because when buying real estate here the purchaser must take into account two separate taxes, the Ontario Land Transfer Tax and the Toronto Land Transfer Tax. The taxes are as follows:
ONTARIO Land Transfer Tax:
Up to $55,000 X .5 % of total property value
From $55,000 to $250,000 X 1 % of total property value
From $250,000 to $400,000 X 1.5 % of total property value
From $400,000 up X 2 % of total property value
TORONTO Land Transfer Tax:
Up to $55,000 X .5 % of total property value
From $55,000 to $400,000 X 1 % of total property value
From $400,000 up X 2 % of total property value
Check out this link to calculate what taxes might for the property you are looking at buying.
EXEMPTIONS:
There are some exemptions for first time buyers for both the Ontario and Toronto Taxes. In order to qualify for the Ontario portion the requirements are as follows:
- The purchaser cannot have previously owned a home, or had any ownership interest in a home, anywhere in the world, at any time.
- If the purchaser has a spouse, the spouse cannot have owned a home, or had any ownership interest in a home, anywhere in the world, while he or she was the purchaser’s spouse. If this is the case, no refund is available to either spouse.
- The purchaser must be at least 18 years of age.
- The application for a refund must be made within 18 months after the date on which the conveyance or disposition occurred. (Note that an application for the refund can be completed upon the electronic registration of the conveyance).
- The purchaser must occupy the home as his or her principal residence no later than nine months after the date of the conveyance or disposition.
- The purchaser cannot have previously received an Ontario Home Ownership Savings Plan (OHOSP) based refund of land transfer tax.
- If the agreement of purchase and sale is entered into before December 14, 2007, the home must be newly constructed.
Check out this link for other Frequently asked questions about the Ontario Land Transfer Tax.
The Toronto Land Transfer Tax also has a rebate for first time home buyers set at a maximum of $3,725.00. In order to qualify for this rebate you must fit into the following criteria:
- The purchaser is at least 18 years of age.
- The purchaser must occupy the home as his/her principal residence no later than nine months after the date of the conveyance or disposition.
- The purchaser cannot have previously owned a home, or had any ownership interest in a home, anywhere in the world, at any time.
- If the purchaser has a spouse, the spouse cannot have owned a home, nor had any ownership interest in a home, anywhere in the world while he/she was the purchaser’s spouse. If this not the case, no refund is available to either spouse.
Check out this link for a list of other frequently asked questions about the Toronto Land Transfer tax.
Hope this helps!