The Ontario Land Transfer Tax (LTT) is a tax imposed by the provincial government on the transfer of real estate property in Ontario, Canada. It is payable by the buyer upon the purchase of a property and is calculated based on the property's purchase price. The tax is applied in addition to any municipal land transfer taxes that may be applicable in certain municipalities, such as Toronto.
The Ontario LTT rates are tiered, meaning that different rates apply to different portions of the purchase price. As of 2022, the Ontario LTT rates for residential properties are as follows:
- 0.5% on the first $55,000 of the purchase price
- 1.0% on the portion of the purchase price between $55,000 and $250,000
- 1.5% on the portion of the purchase price between $250,000 and $400,000
- 2.0% on the portion of the purchase price between $400,000 and $2 million
- 2.5% on the portion of the purchase price exceeding $2 million for single-family residences and duplexes
- 2.0% on the portion of the purchase price exceeding $400,000 for all other types of properties
For example, if you were purchasing a property for $600,000, the Ontario LTT would be calculated as follows:
- 0.5% of $55,000 = $275
- 1.0% of ($250,000 - $55,000) = $1,950
- 1.5% of ($400,000 - $250,000) = $2,250
- 2.0% of ($600,000 - $400,000) = $4,000
Total Ontario LTT = $275 + $1,950 + $2,250 + $4,000 = $8,475
It's important to note that first-time homebuyers in Ontario may be eligible for a rebate of up to $4,000 of the Ontario LTT. Additionally, certain exemptions and rebates may apply in specific circumstances, such as transfers between spouses, transfers to a trust, or transfers of agricultural land. It's recommended to consult with a real estate professional or tax advisor for personalized advice regarding the Ontario LTT and any applicable rebates or exemptions.
