Land Transfer Tax in Ontario
Sunday, Jul 26, 2026
In Canada, every home purchase comes with a Land Transfer Tax, which is charged because you’re gaining ownership and use of the land. It’s an important cost buyers need to plan for, since it must be paid upfront and can’t be rolled into your mortgage. Making room for this tax in your budget ensures a smoother closing process. Ontario land transfer tax is a one-time tax paid at closing when you buy property in Ontario. It’s calculated using a tiered rate system, so different parts of the purchase price are taxed at different rates.
Ontario provincial land transfer tax rates
- 0.5% on the first $55,000
- 1.0% on the portion from $55,000 to $250,000
- 1.5% on the portion from $250,000 to $400,000
- 2.0% on the portion over $400,000
- For one- or two-family residences over $2 million, the portion over $2 million is taxed at 2.5%
How to calculate it
You apply each rate only to the portion of the price that falls in that bracket, then add the amounts together.
Example: $800,000 home
- First $55,000 × 0.5% = $275
- Next $195,000 × 1.0% = $1,950
- Next $150,000 × 1.5% = $2,250
- Remaining $400,000 × 2.0% = $8,000
Total Ontario land transfer tax = $12,475
First-time buyer rebate
If you qualify as a first-time homebuyer, you may get an Ontario rebate of up to $4,000, which can reduce or eliminate the tax on some purchases.
Important note for Toronto
If the property is in Toronto, you usually pay both:
- Ontario land transfer tax
- Toronto municipal land transfer tax
So the total closing tax is higher in Toronto than in the rest of Ontario.
If you want, I can also calculate the exact land transfer tax on a specific purchase price for you.
Take a look at my video on my website.
