In Ontario, the tax is calculated as a percentage of property value, using asking price as a close estimate. Homebuyers in Toronto, however, also incur an additional municipal tax.
To help offset this unwelcome cost, both Ontario and Toronto offer land transfer tax rebates for first-time homebuyers.
Ontario land transfer tax
| Purchase price of home | Marginal Tax rate |
| First $55,000 | 0.5% |
| On $55,000 to $250,000 | 1.0% |
| On $250,000 to $400,000 | 1.5% |
| Over $400,000 | 2.0% |
Source: Ontario Ministry of Revenue, “Land Transfer Tax”
Ontario first-time homebuyer land transfer tax rebate
The Ontario land transfer tax rebate is equal to the full value of the land transfer tax up to a maximum of $2,000.
Eligibility
- The buyer must be older than 18 years
- The buyer must occupy the home within nine months of purchase
- The buyer cannot have owned a home anywhere in the world
- The buyer’s spouse cannot have owned a home while being your spouse
- If you are purchasing a new home, it must be eligible for home warranty
Based on Ontario land transfer tax rates, the rebate will cover the fully taxed amount on houses up to $227,500. For houses over $227,500, homebuyers will receive the maximum $2,000 rebate. To obtain this refund, you need to apply within 18 months after the purchase of the home.1
Source: Ontario Ministry of Revenue, “Land Transfer Tax Refund for First-time Homebuyers”
Toronto land transfer tax
If purchasing a home in Toronto, there is an additional municipal land transfer tax. Toronto’s land transfer tax applies within the following boundaries: Steeles Avenue as the North border, Etobicoke as the West border, Scarborough as the East border, and Lake Ontario as the South border.
| Purchase price of home | Marginal Tax rate |
| First $55,000 | 0.5% |
| On $55,000 to $400,000 | 1.0% |
| Over $400,000 | 2.0% |
Source: City of Toronto, “Municipal Land Transfer Tax”
Toronto first-time homebuyer land transfer tax rebate
First-time homebuyers in Toronto of new and resale homes are eligible to receive a refund up to a maximum of $3,725.
Eligibility
- The buyer must be older than 18 years
- The buyer must occupy the home within nine months of purchase
- The buyer cannot have owned a home anywhere in the world
- The buyer’s spouse cannot have owned a home while being your spouse
- If you are purchasing a new home, it must be eligible for home warranty
Based on Toronto land transfer tax rates, first-time homebuyers with homes of $400,000 or less will avoid the tax altogether.
