Ontario Land Transfer Tax: How Much Will You Pay & How to Calculate It

Ontario land transfer tax is one of the biggest costs most homebuyers do not see coming — and for buyers in Toronto, the surprise is even larger because you pay it twice. The provincial land transfer tax applies to every property purchase in Ontario. Buy within the City of Toronto and a second municipal land transfer tax is added on top, nearly doubling the total.

For many first-time buyers in the GTA, the land transfer tax bill lands at closing and comes as a real shock. On a $900,000 Toronto home, for example, the combined land transfer tax is $28,950 — before legal fees, title insurance, or any other closing costs. Understanding how it is calculated, what rebates you may qualify for, and how to budget for it properly can make a significant difference in how smoothly your closing goes.

Quick answer: Ontario land transfer tax ranges from 0.5% on the first $55,000 of a home's purchase price to 2.5% on amounts over $2,000,000. Toronto buyers pay a matching municipal land transfer tax on top — effectively doubling the cost. First-time buyers in Ontario can claim a rebate of up to $4,000 (provincial) plus up to $4,475 (Toronto municipal) for a combined maximum rebate of $8,475. LTT is paid at closing and cannot be rolled into your mortgage.

This guide walks through the full Ontario LTT bracket table, how Toronto's municipal tax works, a step-by-step example on a $900,000 Toronto purchase, who qualifies for the first-time buyer rebate, and how to budget for land transfer tax as part of your total closing costs.

Key Takeaways

• Ontario LTT is a mandatory provincial tax paid by the buyer at closing. It cannot be added to your mortgage — you need the cash at closing.
• Ontario LTT uses five rate brackets from 0.5% to 2.5%. Each rate applies only to the portion of the purchase price within that tier — like income tax brackets.
• Toronto buyers pay a second municipal land transfer tax (same bracket structure). Combined, it nearly doubles the LTT on any Toronto property. Buyers in Mississauga, Markham, or Richmond Hill pay only the provincial LTT.
• On a $900,000 Toronto purchase: $14,475 Ontario LTT + $14,475 Toronto LTT = $28,950 total. First-time buyers reduce this to $20,475 with up to $8,475 in rebates.
• Ontario first-time buyer rebate: up to $4,000 on provincial LTT. Toronto municipal rebate: up to $4,475. Combined maximum: $8,475 — applied directly at closing through your lawyer.
• Budget for LTT separately from your down payment. It is typically the largest single closing cost line item on any Toronto purchase over $500,000.

What Is Ontario Land Transfer Tax?

Ontario land transfer tax is a provincial tax paid by the buyer every time a property changes ownership — and it applies to virtually every residential and commercial real estate purchase in Ontario, with a small number of exceptions.

Land transfer tax (the official term for the tax collected by the province of Ontario under the Land Transfer Tax Act when a property deed is registered) is calculated as a percentage of the purchase price using a tiered bracket system. The more you pay for a property, the higher the effective tax rate — similar in structure to how income tax brackets work.

According to the Government of Ontario, land transfer tax is payable to the province when title to a property is registered — which happens at closing, handled by your real estate lawyer. You do not receive a separate bill or pay directly; your lawyer collects the amount from you as part of your closing funds and remits it to the province on your behalf.

Several important facts about Ontario LTT that many buyers do not learn until they are already deep into the homebuying process:

• It applies to the full purchase price — not just the amount above your down payment or the mortgage amount. A $900,000 purchase triggers LTT on the full $900,000.
• It is paid entirely by the buyer. The seller has no obligation toward land transfer tax on the sale of the property.
• It cannot be added to your mortgage — it must be paid in cash at closing. This means it needs to be saved separately from your down payment.
• It applies to new builds and resale homes alike. There is no exemption for newly constructed properties in Ontario.

Bottom line: Ontario land transfer tax is a mandatory, cash-only cost that every buyer needs to budget for before making an offer. If you are not budgeting for it, your closing could be significantly short of what is required — which can delay or jeopardize the transaction.

Ontario Land Transfer Tax Brackets 2026 — The Five Tiers

Ontario's land transfer tax brackets work progressively — each tier rate applies only to the portion of the purchase price that falls within that tier's range. This is the same logic as income tax brackets: a higher tier rate does not retroactively apply to the whole price.

Here are the Ontario land transfer tax brackets as established under the Land Transfer Tax Act:

1. First $55,000 of purchase price — Rate: 0.5% — Maximum tax in this tier: $275
2. $55,001 to $250,000 — Rate: 1.0% — Maximum tax in this tier: $1,950 (on the $195,000 increment)
3. $250,001 to $400,000 — Rate: 1.5% — Maximum tax in this tier: $2,250 (on the $150,000 increment)
4. $400,001 to $2,000,000 — Rate: 2.0% — Maximum tax in this tier: $32,000 (on the $1,600,000 increment)
5. Over $2,000,000 — Rate: 2.5% — No cap; applies to every dollar above $2 million

To calculate your Ontario LTT, add up the tax from each bracket that your purchase price reaches. For example, on a $600,000 purchase in Ontario:

• $55,000 × 0.5% = $275
• $195,000 × 1.0% = $1,950
• $150,000 × 1.5% = $2,250
• $200,000 × 2.0% = $4,000
• Total Ontario LTT on a $600,000 purchase: $8,475

Notice that the total on a $600,000 purchase happens to equal the full first-time buyer combined rebate maximum — meaning a qualifying first-time buyer purchasing a $600,000 Ontario home outside Toronto could potentially pay zero land transfer tax after applying the provincial rebate.

Use lendsimpl's Ontario land transfer tax calculator to get an instant estimate for any purchase price without doing the math manually.

Toronto's Municipal Land Transfer Tax — Why Toronto Buyers Pay Double

Toronto's municipal land transfer tax is a second land transfer tax that applies to any property purchase within the City of Toronto boundary — and it is calculated using nearly the same bracket structure as the provincial Ontario LTT, effectively doubling the land transfer tax cost for Toronto buyers.

The Toronto Municipal Land Transfer Tax (MLTT) was introduced in 2008, making Toronto the only city in Ontario with its own residential land transfer tax. The brackets for the Toronto MLTT are:

1. First $55,000: 0.5% — Maximum: $275
2. $55,001 to $250,000: 1.0% — Maximum: $1,950
3. $250,001 to $400,000: 1.5% — Maximum: $2,250
4. $400,001 to $2,000,000: 2.0%
5. Over $2,000,000: 2.5%

For any given purchase price in Toronto, the Ontario LTT and the Toronto MLTT produce the same dollar amount — so you simply double the Ontario LTT calculation to get the Toronto total.

An important geographic point: the Toronto MLTT applies only within the City of Toronto's official municipal boundary. Buyers purchasing in communities that are geographically close to Toronto but outside that boundary — such as Mississauga, Brampton, Markham, Richmond Hill, Vaughan, Scarborough's neighbouring townships, or Pickering and Ajax in Durham Region — pay only the provincial Ontario LTT. This boundary distinction can mean thousands of dollars difference on the same-priced purchase.

Note: Scarborough, North York, and Etobicoke are all within the City of Toronto and therefore subject to the Toronto MLTT, even though they are geographically distant from downtown. If you are unsure whether a specific property falls within the Toronto municipal boundary, your real estate lawyer can confirm at closing.

First-Time Buyer Land Transfer Tax Rebate in Ontario — Up to $8,475

Ontario's land transfer tax rebate for first-time homebuyers is one of the most valuable financial benefits available to eligible buyers — and it is applied directly at closing through your lawyer, so you do not have to wait for a government refund after the fact.

Here is how the first-time buyer LTT rebates work in 2026:

• Ontario provincial rebate: up to $4,000 on the provincial Ontario LTT. This rebate eliminates provincial LTT entirely on purchases up to approximately $368,333. For purchases above that price, the $4,000 maximum rebate still applies — reducing (but not eliminating) the provincial LTT.
• Toronto municipal rebate: an additional rebate of up to $4,475 on the Toronto MLTT. This rebate eliminates the Toronto MLTT entirely on purchases up to approximately $400,000. For purchases above that, the $4,475 maximum is deducted from the total Toronto MLTT owing.
• Combined maximum rebate: $4,000 + $4,475 = $8,475 — available to eligible first-time buyers purchasing within the City of Toronto.
• Outside Toronto (Ontario provincial rebate only): the maximum rebate is $4,000 on the provincial LTT.

To qualify for the Ontario first-time buyer LTT rebate, you must:

1. Be a Canadian citizen or a permanent resident of Canada.
2. Have never previously owned an eligible home anywhere in the world.
3. Occupy the property as your principal residence within nine months of closing.
4. If purchasing with a spouse or partner, they must also qualify as a first-time buyer for the full rebate to apply — otherwise only a partial rebate may be available.

What Ontario homeowners often miss: The first-time buyer rebate applies only to the buyer — not the property. If you have previously owned a home anywhere in the world (even outside Canada), you do not qualify, even if your spouse qualifies. Partial rebates can apply in some joint purchase scenarios. Your real estate lawyer confirms eligibility and applies the rebate at closing automatically.

Real Example: Land Transfer Tax on a $900,000 Toronto Home

The best way to understand Ontario land transfer tax is to walk through a real purchase example. Here is a step-by-step LTT calculation on a $900,000 purchase within the City of Toronto — the price range where many GTA buyers are shopping in 2026.

Step 1 — Calculate the Ontario Provincial LTT on $900,000:

1. $55,000 × 0.5% = $275
2. $195,000 × 1.0% = $1,950
3. $150,000 × 1.5% = $2,250
4. $500,000 × 2.0% = $10,000
5. Ontario LTT total: $275 + $1,950 + $2,250 + $10,000 = $14,475

Step 2 — Calculate the Toronto Municipal LTT on $900,000 (same brackets):

1. $55,000 × 0.5% = $275
2. $195,000 × 1.0% = $1,950
3. $150,000 × 1.5% = $2,250
4. $500,000 × 2.0% = $10,000
5. Toronto MLTT total: $275 + $1,950 + $2,250 + $10,000 = $14,475

Step 3 — Total Land Transfer Tax for a Toronto buyer:

• Ontario LTT: $14,475
• Toronto Municipal LTT: $14,475
• Combined total: $28,950

Step 4 — Apply First-Time Buyer Rebates (if eligible):

• Ontario rebate: $4,000 deducted from provincial LTT — reduces Ontario LTT to $10,475
• Toronto rebate: $4,475 deducted from Toronto MLTT — reduces Toronto MLTT to $10,000
• Combined LTT after rebates: $10,475 + $10,000 = $20,475

Bottom line: On a $900,000 Toronto purchase, plan for $28,950 in combined land transfer tax if you have previously owned a home. If you qualify as a first-time buyer, the rebates reduce that to $20,475. Either way, this is a cash cost at closing — it must be in your lawyer's trust account before you get the keys.

Who Is Exempt from Ontario Land Transfer Tax?

Ontario land transfer tax exemptions are narrow — most buyers in Ontario pay LTT, including on new builds and assignment sales. However, there are specific circumstances under the Ontario Land Transfer Tax Act where LTT is not collected or is refunded.

Transfers that may be exempt from Ontario land transfer tax include:

• Transfers between spouses — Property transferred between legally married spouses (or same-sex partners in a legally recognized marriage) generally qualifies for an LTT exemption, as long as the transfer is made without financial consideration.
• Transfers from a deceased person's estate — Where a property passes from an estate to a beneficiary named in a will, no LTT is typically payable on that transfer. However, if the beneficiary later sells or transfers the property, LTT applies normally.
• Certain transfers of family farms — Transfers of farming property between family members in certain situations may qualify for a partial or full exemption under provincial agricultural land provisions.
• Transfers to family business corporations — Certain transfers from a person to a corporation in which they hold shares may qualify for exemption, subject to specific criteria outlined in the Act.

What is not exempt from Ontario land transfer tax: new construction homes (LTT applies on both new builds and resale), assignment sales in pre-construction, transfers between adult children and parents, and divorcing spouses who are not legally married. Your real estate lawyer reviews your specific circumstances and advises on any applicable exemptions before closing.

How to Budget for Ontario Land Transfer Tax — And 5 Things Buyers Get Wrong

Budgeting for Ontario land transfer tax is straightforward once you know the rules — but many Ontario buyers, especially first-timers, underestimate it or forget to account for it entirely until closing is imminent. Here is how to plan for it properly.

The core rule: land transfer tax must be saved and available as cash at closing, separate from your down payment and separate from your mortgage. It is not optional and cannot be deferred. Your real estate lawyer needs the full amount before the transaction can close.

Here are five common mistakes Ontario buyers make when budgeting for land transfer tax — and what to do instead:

1. Forgetting that Toronto MLTT exists — Many buyers shopping in Toronto research Ontario's provincial LTT and budget accordingly, only to discover at closing that there is an equal second tax (the Toronto MLTT) they did not account for. If you are buying within the City of Toronto, always budget for double. If you are buying just outside Toronto in Mississauga, Markham, or Vaughan, verify the municipal boundary and confirm with your lawyer.
2. Counting LTT rebates before confirming eligibility — First-time buyer LTT rebates are valuable, but eligibility is strict. If you or your partner has ever owned a home anywhere in the world, the full rebate may not apply. Budget conservatively using the non-rebate amount, and treat the rebate as a bonus if you qualify — not a certainty.
3. Treating LTT as part of the down payment — Your down payment funds and your LTT funds are two separate cash requirements. A buyer who saves exactly their minimum down payment but not the LTT will be short at closing. Plan for your down payment, your LTT, your legal fees, your title insurance, and a buffer — as four separate line items.
4. Not including LTT in the maximum purchase price calculation — If your buying budget is exactly $X, remember that buying at $X also triggers LTT on $X. That LTT comes from your closing funds, not your mortgage. Back-calculate from your available cash to confirm how much you can actually spend after reserving for closing costs.
5. Relying on online calculators without confirming the Toronto boundary — Several online LTT calculators ask only for the purchase price but not the exact municipality. If the tool does not ask whether you are buying within the City of Toronto specifically, it may not include the Toronto MLTT. Always verify whether the address is within the City of Toronto boundary before finalizing your LTT budget.

For a complete picture of everything you need to have at closing — beyond just land transfer tax — use lendsimpl's closing cost calculator for Ontario to estimate legal fees, title insurance, CMHC insurance, and other closing expenses.

First-time buyers should also review our guide on down payment rules and accepted sources in Canada to understand exactly how much you need saved before your purchase is possible.

Frequently Asked Questions About Ontario Land Transfer Tax

What is the Ontario land transfer tax and when do you pay it?

Ontario land transfer tax (LTT) is a provincial tax paid by the buyer when a property changes ownership. It is calculated on the full purchase price using a five-tier bracket system ranging from 0.5% on the first $55,000 to 2.5% on amounts over $2,000,000. LTT is paid at closing through your real estate lawyer — it is a mandatory cash cost that cannot be added to your mortgage or deferred. Your lawyer collects the amount from your closing funds and remits it to the Province of Ontario on your behalf when title is registered.

How much land transfer tax do you pay on a $900,000 home in Toronto?

On a $900,000 Toronto purchase, the Ontario provincial land transfer tax is $14,475 and the Toronto municipal land transfer tax is an additional $14,475 — for a combined total of $28,950. If you are a qualifying first-time buyer, you can claim rebates of up to $8,475 combined ($4,000 provincial + $4,475 Toronto municipal), reducing your total LTT to approximately $20,475. Both amounts must be available in cash at closing — neither the provincial nor the municipal LTT can be rolled into your mortgage.

What is the first-time buyer land transfer tax rebate in Ontario?

Ontario's first-time homebuyer LTT rebate is worth up to $4,000 on the provincial land transfer tax. If you are purchasing within the City of Toronto, a separate Toronto municipal rebate of up to $4,475 is also available — bringing the combined maximum to $8,475. The rebates are applied directly at closing through your real estate lawyer; you do not need to apply separately after the fact. To qualify, you must be a Canadian citizen or permanent resident who has never previously owned a home anywhere in the world, and you must occupy the property as your principal residence within nine months of closing.

Does Toronto have its own land transfer tax in addition to Ontario's?

Yes — Toronto buyers pay both the provincial Ontario land transfer tax and a separate Toronto Municipal Land Transfer Tax (MLTT), introduced in 2008. Both use the same five-tier bracket structure, effectively doubling the land transfer tax cost for any purchase within the City of Toronto boundary. Buyers purchasing in nearby communities outside that boundary — such as Mississauga, Markham, Richmond Hill, Vaughan, Ajax, or Pickering — pay only the provincial Ontario LTT. If you are unsure whether a specific address falls within the Toronto municipal boundary, your real estate lawyer can confirm before closing.

Who is exempt from Ontario land transfer tax?

Exemptions from Ontario land transfer tax are limited. Transfers between legally married spouses, transfers from a deceased person's estate to a named beneficiary, and certain transfers of agricultural family property may qualify for a full or partial exemption. First-time homebuyers are not exempt but can claim a rebate of up to $4,000 (provincial) and up to $4,475 if purchasing in Toronto. New builds, assignment sales, transfers between parents and children, and most other residential transactions are subject to full Ontario LTT. Your real estate lawyer reviews your specific circumstances and advises on any exemptions that apply.

Can I add Ontario land transfer tax to my mortgage?

No. Ontario land transfer tax must be paid in cash at closing and cannot be rolled into your mortgage. This means buyers need to have the full LTT amount saved and available — separate from their down payment — before they can take possession of the property. For a $900,000 Toronto purchase, that means an additional $28,950 in closing funds (or $20,475 if you qualify for first-time buyer rebates). Budget for LTT, legal fees, title insurance, and a buffer as separate items from your down payment savings.