Land transfer tax
The BrokerFold Team — Product + Engineering
Last reviewed
Land transfer tax is the tax a buyer pays to the province — and in Toronto, additionally to the city — when ownership of a property transfers. Ontario calls it land transfer tax (LTT); BC’s equivalent is the property transfer tax (PTT). It is calculated on the purchase price through marginal brackets, so the effective rate climbs as the price does, and it is payable in full on closing day through the buyer’s lawyer.
The shape of the tax
Three things about the structure matter more than any specific rate. First, it is tiered: successive slices of the price are taxed at rising rates, so the jump between a modest home and an expensive one is larger than it looks. Second, Toronto is doubled: purchases inside the City of Toronto pay a municipal land transfer tax on top of Ontario’s, roughly mirroring the provincial brackets. Third, rebates exist: first-time-buyer programs in both provinces refund some or all of the tax below eligibility caps, and BC adds a separate exemption stream for qualifying newly built homes. The exact brackets and caps are policy numbers that change — verify the current figures before quoting them to a client.
Why it matters for your practice and website
Land transfer tax is the closing cost buyers most often underestimate, which makes it one of the most-searched questions in Canadian real estate. A page or calculator that answers it honestly — including the Toronto double-tax surprise and the rebate caps — is classic trust-building content for a buyer-facing website, and the conversation it starts is the budget conversation every good agent wants to have early.
Frequently asked questions
Do first-time buyers pay land transfer tax?
Often less, sometimes nothing. Ontario and BC both run first-time-buyer rebate or exemption programs with price caps and eligibility rules, and Toronto layers its own municipal rebate on top. The caps move with policy, so check the current thresholds — a purchase just above a cap can owe the full tax.
Is land transfer tax part of my mortgage?
No — it's due in cash on closing, through your lawyer, on top of your down payment. That's why it belongs at the top of any closing-cost budget: on a mid-priced GTA or Metro Vancouver purchase it is usually the single largest closing cost.
Keep reading
- Closing costs Closing costs are everything a buyer pays beyond the price — land transfer tax, legal fees, title insurance, adjustments — typically a few percent extra.
- Agreement of purchase and sale The APS is the contract at the centre of every Ontario home sale — offer, acceptance, deposit, conditions and closing terms in one document.
- What is Schedule B in the TRREB agreement Schedule B records your technology vendor and website URL inside TRREB's data agreements. What it asks for and where the exact values live.