Land Transfer Tax - What is it?- 1st Time Buyer Rebate? - Let Me Show you

Land Transfer Tax in Ontario

When you buy a home in Ontario, you pay a Land Transfer Tax (LTT) based on the purchase price. The tax is tiered, like income tax, meaning different portions of the price are taxed at different rates:

• 0.5% on the first $55,000

• 1.0% on $55,000 to $250,000

• 1.5% on $250,000 to $400,000

• 2.0% on $400,000 to $2,000,000

• 2.5% on anything above $2,000,000

(Sault Ste. Marie buyers only pay the provincial version—Toronto buyers get dinged with a second municipal LTT on top of this.)

First-Time Home Buyer Rebate

If you’re a first-time buyer, you can get a rebate of up to $4,000 off your provincial LTT.

Here’s how it works:

• The rebate covers the tax on the first $368,000 of your home’s value.

• If your home costs $368,000 or less, you pay zero land transfer tax after the rebate.

• If your home is more than $368,000, you get the full $4,000 rebate, and pay the difference above that.

Example in Sault Ste. Marie

Let’s say you’re buying a home for $300,000:

1. 0.5% on first $55,000 = $275

2. 1.0% on next $195,000 (55K–250K) = $1,950

3. 1.5% on next $50,000 (250K–300K) = $750

Total LTT = $2,975

Since that’s less than the $4,000 rebate, you’d pay $0 in land transfer tax.

Now, let’s say you’re buying a $500,000 home:

1. 0.5% on first $55,000 = $275

2. 1.0% on next $195,000 = $1,950

3. 1.5% on next $150,000 = $2,250

4. 2.0% on next $100,000 (400K–500K) = $2,000

Total LTT = $6,475

Apply the $4,000 rebate → you still owe $2,475.

Who Qualifies as a First-Time Buyer?

You must:

• Be a Canadian citizen or permanent resident.

• Be 18 or older.

• Have never owned a home anywhere in the world.

• Be occupying the home as your principal residence within 9 months of the closing.

• If buying with a spouse, they also must not have owned a home.

Check out my Land Transfer Tax Calculator here: https://movewithmooney.ca/land-transfer-tax-calculator

If you have any questions my lines are always open

Rick Mooney

(705) 542-4685

rick.mooney@exprealty.com