Land Transfer Tax applies to all conveyances of land in Ontario. First time purchasers of newly constructed homes may be eligible for a refund of all or part of the tax payable.
The Benefit
The refund for first time purchasers of newly constructed homes may offset the land transfer tax ordinarily payable at the time of registration. The maximum amount refundable is dependent upon the date of the agreement of purchase and sale:
- For agreements entered into after March 31, 1999, the refund will not exceed $2,000.
- For agreements entered into on or before March 31, 1999, the refund will not exceed $1,725.
No interest is paid on this refund.
Eligibility
Requirements to qualify for a refund
- The purchaser must be at least 18 years of age.
- Applications for a refund must be made within 18 months after the date of conveyance or disposition.
- The purchaser must occupy the home as his or her principal residence within 9 months of the date of the conveyance or disposition.
- The purchaser cannot have previously owned a home or had any ownership interest in a home, anywhere in the world.
A spouse of the purchaser cannot have owned a home or had any ownership interest in a home, anywhere in the world while he or she was the purchaser's spouse.
How to Apply
Qualifying taxpayers may claim an immediate refund at time of registration in one of two ways:
Alternatively, if land transfer tax has previously been paid at the time of registration, qualified purchasers may apply for a refund by completing a Land Transfer Tax Refund Affidavit for First Time Purchasers of Newly Constructed Homes
and forwarding it directly to the ministry.
Toronto Land Tranfer Tax Calculator
Land Transfer Tax Rebates (Provincial and Toronto)
Program
First-time buyers of new and re-sale homes are eligible to receive rebates of the provincial and Toronto land transfer taxes. The maximum provincial land transfer tax (LTT) rebate for first-time buyers is $2,000 and the maximum Toronto LTT rebate for first time buyers is $3,725. A FULL rebate of the Toronto land transfer tax is also available for ALL buyers who entered into Agreements of Purchase and Sale prior to December 31, 2007.
Details
Provincial LTT
Provincial LTT is payable anywhere in Ontario (including Toronto)
Maximum provincial LTT first-time buyer rebate is $2,000 (equivalent to the provincial LTT payable on a $227,500 property).
For RESALE homes, the provincial rebate applies only to first-time buyers who entered into Agreements of Purchase and Sale AFTER December 13, 2007.
First-time buyers of NEWLY CONSTRUCTED HOMES are eligible for the provincial rebate even if they entered into Agreements of Purchase and Sale prior to December 13, 2007.
The provincial LTT for residential properties is calculated as follows (An easy-to-use calculator is available at www.NoHomeBuyingTax.com):
0.5% of the amount of the purchase price up to and including $55,000, plus
1% of the amount of the purchase price between $55,000 and $250,000, plus
1.5% of the amount of the purchase price between $250,000 and $400,000, plus
2% of the amount of the purchase price above $400,000
Toronto LTT
Toronto LTT is payable only for properties in the City of Toronto.
Maximum Toronto LTT first-time buyer rebate is $3,725 (equivalent to the Toronto
LTT payable on a $400,000 property).
ANY purchaser who entered into an Agreement of Purchase and Sale prior to
December 31, 2007 is eligible for a FULL rebate of the Toronto LTT.
Toronto LTT rebates are in addition to any provincial LTT rebate that the buyer
qualifies for.
The Toronto LTT for residential properties is calculated as follows (An easy-to-use calculator is available at www.NoHomeBuyingTax.com):
0.5% of the amount of the purchase price up to and including $55,000, plus
1% of the amount of the purchase price between $55,000 and $400,000, plus
2% of the amount of the purchase price above $400,000
First-Time Buyer Eligibility
To be eligible as a first-time buyer for the provincial LTT rebate and/or Toronto LTT rebate,
The purchaser must be at least 18 years of age.
The purchaser must occupy the home as his or her principal residence no later than nine months after the date of the conveyance or disposition.
The purchaser cannot have previously owned a home, or had any ownership interest in a home, anywhere in the world, at any time.
If the purchaser has a spouse, the spouse cannot have owned a home, or had any ownership interest in a home, anywhere in the world while he or she was the purchaser’s spouse. If this is the case, NO refund is available to either spouse. Note: If a purchaser’s spouse owned an interest in a home BEFORE becoming the purchaser’s spouse, but not while the purchaser’s spouse, the purchaser may be eligible for some rebate.
http://www.toronto.ca/taxes/mltt.htm#rates
More Information
Provincial LTT:
Ontario Ministry of Finance:
1-800-263-7965
Toronto LTT:
City of Toronto: 416-338-0338
