Buying a home costs more than just the property’s purchase price.
The total cost of purchasing a home includes additional costs such as a land transfer tax.
What is Land Transfer Tax?
The land transfer tax is a provincial tax you pay in most Canadian provinces when purchasing property.
The term ‘land’ does not necessarily refer to only a bare empty lot; it also includes, but is not limited to, already constructed buildings, buildings to be constructed, structures, and fixtures.
Generally, the land transfer tax you pay is calculated on the amount paid for the land, plus any remaining amount on any mortgage or debt assumed on the purchase of the property.
Sometimes, land transfer tax is calculated based on the land’s fair market value.
Who Pays Land Transfer Tax?
The buyer pays land transfer tax.
If land or building title is transferred to you, you must pay the land transfer tax.
This usually occurs when you enter an agreement to purchase a real estate property.
Land Transfer Tax Rebate
If you pay the land transfer tax as a first‑time homebuyer, you may be eligible to receive a land transfer tax rebate for all or part of the land transfer tax.
For some provinces, the land transfer tax refund can be claimed when registering the land or building.
This can immediately offset the land transfer tax you would need to pay if you meet the criteria.
Otherwise, if you do not claim the refund at registration, you will need to pay the land transfer tax and then claim the refund.
How Much is Land Transfer Tax?
The land transfer tax you pay when you purchase a land or building varies depending on the province you have purchased the property.
Ontario
| Price of home | Land Transfer Tax |
|---|---|
| First $55,000 | 0.5% |
| Over $55,000 up to $250,000 | 1.0% |
| Over $250,000 up to $400,000 | 1.5% |
| Over $400,000 up to $2,000,000 | 2.0% |
| *Over $2,000,000 | 2.5% |
*Where the land contains one or two single-family residences
For land purchases with a purchase and sale agreement for land entered into on or before November 14, 2016, and registrations and dispositions before January 1, 2017, the above land transfer tax rates apply, excluding land transfer tax for amounts over $2,000,000.
The Ontario government provides a land transfer tax refund to first-time home buyers.
Starting from 2017, homes purchased for over $368,000 are eligible for a maximum refund of $4,000.
There is no land transfer tax for qualifying first‑time home purchases up to $368,000.
To apply for this refund, you need to provide certain documents.
To be eligible for a refund, you need to be a Canadian citizen or permanent resident that is at least 18 years of age, and you or your spouse should not have owned a home (anywhere in the world) previously, regardless of whether the home was purchased, inherited, or received as a gift.
Also, you must occupy the home as your principal residence within nine months of purchase.
Quebec
For Quebec land transfers, the tax base for transfer duty is the higher of the following:
- The purchase cost of the property, excluding the GST and the QST
- The amount included in the deed of sale
- The market value of the property
| Value | Land Transfer Duty |
|---|---|
| Up to $55,200 | 0.5% |
| Over $55,200 up to $276,200 | 1.0% |
| Over $276,200 up to $500,200 | 1.5% |
| Over $500,000 up to $1,000,000 | 2.0% |
| Over $1,000,000 up to $2,000,000 | 2.5% |
| Over $2,000,000 | 3.0% |
British Columbia
When you purchase property in British Columbia, you will be required to pay a property transfer tax unless you are exempt from paying this tax.
Generally, the property transfer tax you pay depends on the fair market value of the purchased property when it is registered.
The BC government applies three different property transfer tax rates:
The General Property Transfer Tax: This applies to all taxable transactions and is calculated as follows:
| Fair Market Value of home | Land Transfer Tax |
|---|---|
| First $200,000 | 1.0% |
| Over $200,000 up to $2,000,000 | 2.0% |
| Over $2,000,000 | 3.0% |
Further Property Transfer Tax: This applies to residential properties worth over $3,000,000.
If your property is worth over $3,000,000, a further 2% tax will be applied to your property.
Additional property transfer tax: Foreigners are required to pay an additional property transfer tax on the fair market value of their residential property purchase.
Alberta
In place of a land transfer tax, the Alberta government charges a property registration fee that includes a base fee that is $50, plus $2 for every $5,000 of the property’s value (or part thereof).
Additionally, you pay a mortgage fee of $50, plus $1.50 for every $5,000 of your mortgage principal amount.
Manitoba
If you purchase a property in Manitoba, the land transfer tax is calculated based on the property’s fair market value on the date of registration.
The land transfer tax is calculated as follows:
| Value of Property | Land Transfer Fee |
|---|---|
| On the first $30,000 | 0% |
| On amount between $30,001 to $90,000 | 0.5% |
| On amount between $90,001 to $150,000 | 1% |
| On amount between $150,001 to $200,000 | 1.5% |
| On amount over $200,000 | 2% |
Saskatchewan
Saskatchewan charges a land title transfer fee as shown below:
| Value | Land Transfer Fee |
|---|---|
| $0 to $500 | $0 |
| $501 to $8,400 | $25 |
| $8,401 and greater | 0.3% of the value of the title |
To register a mortgage, you also need to pay a fee of $166 for the first four titles, plus $55 per additional title.
Nova Scotia
When you purchase a property in Nova Scotia, this results in a Deed Transfer Tax (DTT).
Each municipality in Nova Scotia sets its Deed Transfer Tax rates applied to the sale price of the property purchased.
The deed transfer tax rate ranges from 0.5% to 1.5%.
New Brunswick
Purchasing a property in New Brunswick requires a land transfer tax that is calculated as 1% of the property’s assessed value or consideration for the transfer, whichever is greater.
Newfoundland and Labrador
You will need to pay the Registration of Deeds Fee when you purchase a property in Newfoundland and Labrador.
The associated fees are as follows:
To register a mortgage less than $500: $100
To register a mortgage more than $500: $100, plus $0.40 for every additional $100 or part of $100.
To register a release or transfer of mortgage: $100
Prince Edward Island
For properties purchased in Prince Edward Island, the Real Property Transfer Tax Is 1% of the greater of:
- The purchase price of the real property; or
- The assessed value of the real property.
Northwest Territories
The land transfer tax in the Northwest Territories comprises the following fees:
- For value of land between $0 to $1,000,000, $2 for each $1,000 of value or part thereof, subject to a minimum fee of $100.
- For value of land more than $1,000,000, $2,000 plus $1.50 for each $1,000 of value or part thereof in excess of $1,000,000.
- Registration of mortgage fee of $1.50 for each $1,000 or part thereof of the mortgage amount subject to a prescribed minimum fee of $80.
Yukon
If you purchase a property in the Yukon, the land transfer tax payable is calculated as
| Value of Land | Land Transfer Tax |
|---|---|
| Less than $100,000 | $50 Plus assurance fund fee |
| From $100,000 but less than $500,000 | $150 Plus assurance fund fee |
| From $500,000 but less than $3,000,000 | $350 Plus assurance fund fee |
| From $3,000,000 but less than $10,000,000 | $550 Plus assurance fund fee |
| From $10,000,000 | $750 Plus assurance fund fee |
The assurance fund fee is $20 for the first $10,000, plus $10 for each $10,000 or portion thereof, of additional declared value since the last transfer was registered or title was issued.
Frequently Asked Questions
- Do you pay HST on land transfer tax?
- Does the seller always pay transfer taxes?
