Land Transfer Tax
 

Provincial Land Transfer Tax

Buyers in most areas will have to add Land Transfer Taxes to their closing costs.  Land transfer taxes are part of the closing procedures and are due at the time title to the property is registered with either the Land Registry Office or the Land Tittles Office.  These taxes, levied on properties that are changing hands, are the responsibility of the buyer. Depending on where you live, taxes can range from a half a per cent to two per cent of the total value of the property. Your lawyer is likely to ask you to provide a cheque to him to cover these costs prior to the closing date.

Many provinces have multi-tiered taxation systems that can sometimes be difficult to understand. The following chart illustrates how the Ontario Land Transfer tax is calculated;

 

Value of Consideration

Provincial Rate

On the first $55,000 of value

0.5%

On the value between $55,000 to $250,000

1.0%

On the value between $250,000 to $400,000

1.5%

On the value over $400,000.00

2.0%

 

Municipal Land Transfer Tax

For those who are looking to purchase a home within the City of Toronto, you should be aware that, effective February 1, 2008, an additional municipal land transfer tax (MLTT) is also as follows;

 

For property containing at least one, and not more than two, single family residences with a consideration value of:

Value of Consideration

MLTT Rate

Up to and including $55,000.00

0.5% plus

$55,000.01 to $400,000.00

1.0% plus

Over $400,000.00

2.0%



For all other property with a consideration value:

Value of Consideration

MLTT Rate

Up to and including $55,000.00

0.5% plus

$55,000.01 to $400,000.00

1.0% plus

$400,000.01 to $40,000,000.00

1.5% plus

Over $40,000,000.00

1.0%