Land Transfer Tax


Land transfer tax

In general, if you buy land or an interest in land in Ontario, you must pay Ontario’s land transfer tax, whether or not the transfer is registered at one of Ontario’s land registry office.

 

Land includes any buildings, buildings to be constructed, and fixtures (such as light fixtures, built-in appliances and cabinetry).

Land transfer tax is normally based on the amount paid for the land, in addition to the amount remaining on any mortgage or debt assumed as part of the arrangement to buy the land.

In some cases, land transfer tax is based on the fair market value of the land, for example, where:

a lease can exceed 50 years;

land is transferred from a corporation to one of its shareholders; or

land is transferred to a corporation, if shares of the corporation are issued.

In addition to Ontario’s land transfer tax, transfers of land located in the City of Toronto may also be subject to the City of Toronto’s own municipal land transfer tax.

For information on the City of Toronto Municipal Land Transfer Tax:

visit their website or

call 416 338-4829

TTY 416 392-0719 (Telephone device for the deaf)

Monday to Friday, 8:30 a.m. to 4:30 p.m.

Calculator

Land transfer tax calculator

Reporting & Remitting Tax

 

You must pay Ontario’s land transfer tax at the time the transfer is registered.

If the transfer is not registered, you must submit a Return on the Acquisition of a Beneficial Interest in Land to the Ministry of Revenue along with payment of tax within 30 days.

Exemptions from land transfer tax are limited. The main exemptions include:

certain transfers from an individual to their family business corporation;

certain transfers of farmed land between family members;

certain transfers between spouses;

certain transfers of a life lease from a non-profit organization or a charity.

A deferral of land transfer tax may be available when land is transferred between affiliated corporations, and notice of the transfer is not registered in a land registry office.

For more information about exemptions and deferral of land transfer tax, refer to the list of land transfer tax bulletins.

 

Refund Program for First-Time Homebuyers

 

First-time homebuyers may be entitled to a refund of Ontario’s land transfer tax, up to a maximum of $2,000. This refund is usually claimed at the time of registration. If not, the refund may be claimed directly from the Ministry of Revenue.

To claim a refund, you

must be at least 18 years old;

must occupy the home as your principle residence within 9 months after the date of transfer; and

cannot have previously owned a home, or an interest in a home, anywhere in the world

In addition,

your spouse can not have owned a home, or an interest in a home, anywhere in the world while being your spouse.

If not claimed at the time of registration, refunds must be requested within 18 months of registration.

For more information, see Ontario Tax Bulletin LTT 1-2008 Land Transfer Tax Refunds For First-Time Homebuyers.