What is land transfer tax?

Land transfer tax (LTT) is a tax you have to pay when you transfer ownership of a property to yourself. This is not to be confused with GST, which is tax on the sale of a newly constructed or substantially renovated home. The LTT applies to any home sale, either new or previously owned. It’s possible to owe both GST and LTT on one home purchase.

Every province has the LTT except for Alberta and Saskatchewan, which instead of a smaller land transfer fee.

Three provinces – Ontario, British Columbia, and P.E.I – have LTT rebate programs which reimburse first-time homebuyers for all or part of the tax. Toronto has an additional municipal land transfer tax and its own rebate for first-time homebuyers, and Montreal has its own LTT as well.

How is LTT calculated?

Each province calculates LTT (or in Alberta and Saskatchewan, land transfer fees) differently. In every case, it’s calculated as a percentage of the purchase price of the home, but the exact percentages vary.

Alberta

Alberta does not have a land transfer tax, but you are required to pay title registration and mortgage registration fees.

The fee is calculated like this:

$50.00 + $1 for every $5,000 of the value of the land

So a house valued at $500,000 would cost

$50.00 + ($1 × ($500,000/$5,000)) = $150

The mortgage registration fee is similar, except that it’s only charged on the mortgage amount, not the land value amount. So, if we were to put a 20% down payment on a $500,000 property, the remaining mortgage would be $400,000. The mortgage registration fee would then be this:

$50.00 + ($1 × ($400,000/$5,000)) = $130

That brings the total cost to registering your property to $280.
If you were to buy a house in cash (without a mortgage) then you would avoid the mortgage registration fee, but be required to pay the title registration fee.

British Columbia

Tax on the portion of the purchase…	Property Transfer Tax
… up to $200,000	1%
… between $200,001 and $2 million	2%
… over $2 million but less than $3 million	3%
… over $3 million	2%

The property transfer tax in British Columbia is bracketed. If you purchase a home worth $300,000, you don’t pay a flat 2%. Instead, you pay 1% on $200,000 and 2% on $100,000, for a total of $4,000.
If you bought a home worth $3 million, you would pay:

Value of the Property	Rate	Tax Owed
First $200,000	1.0%	$2,000
Next $1.8 million	2.0%	$36,000
Last $1 million	3.0%	$30,000
Total tax owed	$68,000

 

Finally, if you were to buy the most expensive home in Vancouver, worth $75.8 million, you would pay:

Value of the Property	Rate	Tax Owed
First $200,000	1.0%	$2,000
Next $1.8 million	2.0%	$36,000
Next $1 million	3.0%	$30,000
Last $72.8 million	2.0%	$1,456,000
Total tax owed	$1,524,000

If the property you’re buying is a farm or mixed commercial-residential, then that extra 2% over $3 million is only applicable to the residential portion of the property.

Manitoba

Tax on the portion of the purchase…	Rate
… up to the first $30,000	0%
… between $30,001 and $90,000	0.50%
… between $90,001 and $150,000	1.00%
… between $150,001 and $200,000	1.50%
… over $200,000	2.0%

The land transfer tax is calculated as a percentage of the home value, but there is an additional $70 (flat fee) that you have to pay as well.
If you bought a home worth $350,000, you would owe 0% on the first $30,000, 0.5% on the amount up to $90,000, 1% on the amount up to $150,000, 1.5% on the amount up for $200,000, and 2% on the remaining $100,000 for a total of $3,870.

New Brunswick

The land transfer tax in New Brunswick is a flat 1.0% of the assessed value of the property.
If you bought a home worth $350,000, you would owe $3,500.

Newfoundland and Labrador

Newfoundland and Labrador doesn’t technically have a land transfer tax, but it does have a registration fee.
You only pay a $100 fee on the first $500 (that isn’t a typo, it really is only the first five hundred dollars), and 0.4% on the remaining amount. So if you bought a house worth $350,000, you would owe $100 + 0.4% on the remaining $349,500 for a total of $1,498.

Nova Scotia

Nova Scotia has one of the more complex land transfer tax laws, as each municipality has its own land transfer tax rate. These range from 0.0% in Kentville to 1.5% in Halifax. All tax is calculated on the assessed value of the property.
The full table of tax rates can be found on the Service Nova Scotia website, but for quick reference here are the rates some of the most populous cities.

City	Tax Rate
Halifax	1.5%
Cape Breton	1.5%
Truro	1.0%
Amherst	1.25%
New Glasgow	1.0%
Bridgewater	1.5%
Yarmouth	1.0%
Kentville	0.0%

On the Service Nova Scotia website, they post the disclaimer that “rate changes are at the discretion of the municipalities and may not be reported to SNS.” Check with your realtor or real estate lawyer.

Ontario

Tax on the portion of the purchase …	Rate
… up to $55,000	0.5%
… between $55,001 and $250,000	1.0%
… between $250,001 and $400,000	1.5%
… between $400,001 and $2 million	2.0%
… over $2 million	2.5%

In Ontario, there is a bracketed land transfer tax system. You only pay the corresponding land transfer tax that falls within the ranges in the table. If you bought a house worth $500,000, the land transfer tax would be broken down like this:

Value of the Property	Rate	Tax Owed
First $55,000	0.5%	$275
Next $195,000	1.0%	$1,950
Next $150,000	1.5%	$2,250
Last $100,000	2.0%	$2000
Total tax owed	$6,475

Toronto

Tax on the portion of the purchase …	Rate
… up to $55,000	0.5%
… between $55,001 and $250,000	1.0%
… between $250,001 and $400,000	1.5%
… between $400,001 and $2 million	2.0%
… over $2 million	2.5%

In Toronto, there is an additional land transfer tax. The tax rates are exactly the same as their provincial counterpart, so calculating it is easy – simply double the tax owed. The Toronto land transfer tax will always be double that of any other city in Ontario.
On that same $500,000 home, you would owe $6,475 × 2, or $12,950.

Prince Edward Island

In Prince Edward Island, the land transfer tax is calculated based on the greater of either the home purchase price or the assessed value.
Let’s say there was a home assessed at $200,000 in Charlottetown. If you really wanted to make sure you got the home, you might pay an additional $10,000 over asking. In that case, even though the property value is assessed at $200,000, you paid $210,000 and have to pay land transfer tax on that amount.
Conversely, if you bought that same $200,000 home for $10,000 under asking, you would have to pay tax based on the assessed value of $200,000.

Tax on the portion of the purchase …	Rate
… up to $30,000	0.0%
… over $30,000	1.0%

If you bought a house worth $200,000 for that amount, you would owe tax thusly:

Value	Tax Rate	Tax Owed
First $30,000	0.0%	$0
Last $170,000	1.0%	$1,700

Quebec

Tax on the portion of the purchase …	Rate
… up to $50,000	0.5%
… between $50,001 and $250,000	1.0%
… over $250,000	1.5%

In Quebec, there is a bracketed land transfer tax system. You only pay the corresponding land transfer tax that falls within the ranges in the table. If you bought a house worth $500,000, the land transfer tax would be broken down like this:

Value	Tax Rate	Tax Owed
First $50,000	0.5%	$250
Next $200,000	1.0%	$2,000
Last $250,000	1.5%	$3,750
Total tax owed	$6,000

Montreal

In Montreal, there are additional tax brackets. Unlike Toronto, where the land transfer tax is doubled, the Montreal land transfer tax is only a little bit more. The tax brackets are as follows:

Tax on the portion of the purchase …	Rate
… up to $50,000	0.5%
… between $50,001 and $250,000	1.0%
… between $250,001 and $500,000	1.5%
… between $500,001 and $1 million	2.0%
… over $1 million	2.5%

Because the brackets are the same up until $500,000, you only notice a difference with houses valued at more than half a million dollars.
That same $500,000 house would owe taxes like this:

Value	Tax Rate	Tax Owed
First $50,000	0.5%	$250
Next $200,000	1.0%	$2,000
Next $250,000	1.5%	$3,750
Total tax owed	$6,000

However, a Montreal home worth $1 million would owe this tax:

Value	Tax Rate	Tax Owed
First $50,000	0.5%	$250
Next $200,000	1.0%	$2,000
Next $250,000	1.5%	$3,750
Next $500,000	2.0%	$10,000
Total tax owed	$16,000

If that house were in Gatineau, the tax would only be $13,500.

Saskatchewan

Saskatchewan, like Alberta, doesn’t have a land transfer tax. Instead, there is a land title transfer fee, which is a flat 0.3% of the home’s value.

Land Transfer Tax Rebates

There are only three provinces that offer land transfer tax rebates: Ontario, British Columbia, and Prince Edward Island.

Ontario Land Transfer Tax Refund

A first-time homebuyer, for the purposes of the Ontario Land Transfer Tax Refund, is defined as someone who:

1. Is at least 18 years old
2. Has never owned a home or an interest anywhere in the world
3. Has a spouse that has never owned a home while they were their spouse

You are not eligible for this refund even if the house you owned was a gift or inheritance. There is also no way for you to ever qualify as a “first-time” homebuyer again.
This rule is a lot more stringent than the First-Time Home Buyers’ Tax Credit or Home Buyers’ Plan, which only require you to not have owned a house in the past four years.
The refund is the exact amount of the land transfer tax owed, up to a maximum of $4,000.

Municipal Land Transfer Tax Rebate (Toronto)

A first-time homebuyer, for the purposes of the Municipal Land Transfer Tax Rebate, is defined as someone who:

1. Is at least 18 years old
2. Occupies the house as their principal residence no later than nine months after they claim ownership
3. Has never owned a home or an interest anywhere in the world
4. Has a spouse that has never owned a home while they were their spouse
5. Is a Canadian citizen or permanent resident. If they become a resident or citizen within 18 months, they may apply for the rebate.

The rebate is the exact amount of the municipal land transfer tax paid, up to a max of $4,475.
Purchasing a property in Toronto as a first-time homebuyer can mean a rebate of up to $8,475.

British Columbia First Time Home Buyers’ Program

The B.C.First Time Home Buyers’ Programisn’t as comprehensive as Ontario’s.
The max rebate value is $8,000, but only applies to properties that are:

1. Located in B.C.
2. Used only as a principal residence
3. Have a value of less than $500,000
4. Are smaller than 0.5 hectares

There is the possibility of a partial rebate if the home is valued between $500,000 and $525,000, but it is cut off completely after $525,000.

If one of the purchasers doesn’t qualify for the First Time Home Buyers’ Program (for example, if they had owned a home before), you are still eligible to receive 50% of the rebate.
In order to qualify for the program, on the date the property is registeredyou must:

1. Be a Canadian citizen or permanent resident
2. Have lived in B.C. for 12 consecutive months, or have filed two income tax returns as a B.C. resident in the past 6 years
3. Have never owned a home or an interest anywhere in the world
4. Have never received a first time homebuyers’ exemption or refund

Prince Edward Island Real Property Transfer Tax First-Time Home Buyers Exemption

The P.E.I exemption covers 100% of the cost of the land transfer tax.
In order to qualify for the P.E.I exemption, you must:

1. Be a Canadian citizen or permanent resident
2. Have kept your principal residence in P.E.I for the previous six consecutive months
3. Have never owned a home that was your principal residence anywhere in the world
4. Have never obtained a first time homebuyers’ exemption in any jurisdiction
5. Occupy, or intend to occupy, the property as their principal residence

If you haven’t lived in P.E.I for six months before purchasing a home, you can still qualify after having lived in the property for six consecutive months after purchase.
If you don’t immediately occupy the property for six consecutive months following the purchase, you must forfeit the exemption.