Ontario & City of Toronto Land Transfer Taxes
(Residential)

Province of Ontario News Release
(December 13, 2007):
ONTARIO EXPANDS LAND TRANSFER TAX REFUND PROGRAM: First-time buyers of resale homes to benefit from new tax measure.
Effective December 14, first-time buyers of resale homes, as well as newly constructed homes, would be eligible for a refund from the provincial government of up to $2,000 of the Land Transfer Tax paid. A $2,000 rebate is equivalent to the Provincial Land Transfer Tax payable on a purchase price of $227,500 (net of GST).

NEW: In October, Toronto City Council approved a municipal land transfer tax that will be levied on top of the provincial land transfer tax. This tax, strongly opposed by Ontario Realtors®, will take effect on February 1, 2008. Use the calculator below to see what the two land transfer taxes tax will cost a Home Buyer in 2008.

News Releases from both sides of the debate

Note: Some financial institutions are now offering to pay some/all of the new Toronto Land Transfer Tax or rebate it to you as a cash-back option — usually tied to locking you in to a 5+ year mortgage. Sounds good, but be very careful to note the mortgage rate, terms and conditions, and do lots of comparison shopping. If you get back a few thousand from your lender up front but agree to a higher rate of interest, you will end up paying many more thousands in interest over the term of your mortgage. Better just to shop for the best possible interest rate.

A $4,000 gift for home-buyers? Don't bank on it by Garry Marr, Financial Post (Dec. 4, 2007)

December 14, 2007 — The City of Toronto has indicated that it has been able to make arrangements that will allow purchasers who are eligible for a FULL rebate of the Toronto Land Transfer Tax (TLTT) to close their transactions without paying the TLTT upfront (and then receiving a rebate at a later date).

Details
According to the City, purchasers who are eligible for a FULL rebate of the Toronto land transfer tax will not have to pay the tax (meaning that they do not have to pay the tax upfront and be rebated later). This includes the following:

• Purchasers who have entered into an Agreement of Purchase and Sale for a property on or before December 31, 2007; and

• First-time home buyers where the total Toronto land transfer tax is $3,725 or less ($3,725 is the amount of TLTT payable on a home purchased for $400,000). First-time home buyers with Toronto land transfer tax payable above the maximum rebate amount of $3,725 (those purchasing homes above $400,000) will be required to pay the total Toronto land transfer tax, and then receive the maximum rebate of $3,725 at a later date from the City. Once all changes have been made to Teranet�s collection system, in the spring of 2008, these buyers will only have to pay the balance of the Toronto land transfer tax above $3,725.

For more information
For more information: City of Toronto website or call the City of Toronto at 416-338-0338.