The Tax You Pay on Closing Day.
Land transfer tax is one of the larger one-time costs of buying a home in Ontario — and if the property is in the City of Toronto, you pay it twice, once to the province and once to the city. Here is how it works, who qualifies for a rebate, and how to estimate what you will owe.
How land transfer tax works
Two possible layers: a provincial tax everywhere in Ontario, plus a municipal tax inside the City of Toronto.
When you buy a property in Ontario, the province charges a land transfer tax based on the purchase price. It is calculated using marginal brackets — meaning the price is divided into tiers, and a higher percentage applies only to the portion of the price that falls into each higher tier. As the purchase price rises, the effective rate rises with it. The tax is paid on closing day, usually collected by your real estate lawyer and remitted on your behalf.
If the property is located within the City of Toronto, a second, separate municipal land transfer tax applies on top of the provincial one, using its own set of marginal brackets. In practice, this roughly doubles the land transfer tax bill for a Toronto purchase compared with an identical purchase elsewhere in Ontario. Properties in Vaughan, York Region and most of the Greater Toronto Area outside the City of Toronto boundary pay the provincial tax only.
Land transfer tax is a cash cost — it generally cannot be rolled into your mortgage — so it is important to budget for it separately alongside your down payment and other closing costs.
The exact bracket thresholds, percentages and rebate maximums are set by the province and the city and can change over time. Treat the descriptions here as general information; confirm the current figures and your specific amount with your real estate lawyer. This is not tax advice.
First-time buyer rebates
Both levels of government offer relief for qualifying first-time buyers.
Ontario offers a first-time homebuyer rebate that reduces or, for lower-priced homes, can fully offset the provincial land transfer tax up to a set maximum. If your purchase is within the City of Toronto, a separate municipal rebate is also available up to its own maximum, further reducing the Toronto portion of the tax.
Eligibility rules apply — for example, generally you must not have owned a home anywhere before, and in the case of a couple, ownership history of both partners is typically considered. Rebate maximums and qualifying conditions are set by the province and the city and can change, so confirm the current amounts and whether you qualify with your real estate lawyer.
Estimate yours
Get a quick illustrative figure before you talk to your lawyer.
Land transfer tax calculator
Enter your purchase price and location to see an estimate of the provincial land transfer tax — plus the City of Toronto municipal tax where it applies. Results are illustrative and use general assumptions; your lawyer will confirm the exact amount on closing.
Where it fits in your budget
Land transfer tax is one piece of a larger set of upfront costs.
Beyond your down payment, closing day brings a handful of one-time costs — land transfer tax is usually the largest of them, but it sits alongside legal fees, title insurance, a possible appraisal, adjustments and other expenses. Planning for all of them together helps you avoid a surprise shortfall on closing.
Related pages
Want the exact number for your purchase?
Use the calculator, then confirm with your lawyer.