The short version
- Everyone in Ontario pays the provincial land transfer tax.
- Inside the City of Toronto, including Scarborough, you also pay the Toronto tax, which roughly doubles the bill.
- Pickering, Ajax, Markham and other GTA cities outside Toronto do not charge their own land transfer tax.
- First-time buyers can get up to $4,000 (Ontario) plus $4,475 (Toronto) back.
How Ontario land transfer tax works
Ontario charges the tax in bands, like income tax. You pay a higher rate only on the part of the price that falls inside each band (Ontario):
| Part of the price | Rate |
|---|---|
| Up to $55,000 | 0.5% |
| $55,000 to $250,000 | 1.0% |
| $250,000 to $400,000 | 1.5% |
| $400,000 to $2,000,000 | 2.0% |
| Over $2,000,000 (homes with one or two units) | 2.5% |
Toronto adds its own tax
If the home is in the City of Toronto, which includes Scarborough, North York and Etobicoke, you also pay the Municipal Land Transfer Tax. Up to $3 million it uses the same bands as Ontario, and higher rates apply to homes over $3 million (City of Toronto). In most price ranges, that means you pay the Ontario amount twice.
Worked examples
| Price | Outside Toronto (Ontario only) | In Toronto (Ontario + Toronto) | Toronto, first-time buyer |
|---|---|---|---|
| $600,000 | $8,475 | $16,950 | $8,475 |
| $700,000 | $10,475 | $20,950 | $12,475 |
| $900,000 | $14,475 | $28,950 | $20,475 |
| $1,200,000 | $20,475 | $40,950 | $32,475 |
Estimates for a single-family home, before legal fees. Use my land transfer tax calculator for your exact price.
First-time buyer rebates
- Ontario: up to $4,000, which covers the full tax on homes up to $368,000 (Ontario).
- Toronto: up to $4,475 (City of Toronto).
- Generally, you must never have owned a home anywhere in the world, and you must move in within nine months of buying. If you buy with a spouse, special rules apply. Your lawyer claims the rebates at closing.
Should you buy just outside Toronto?
On a $900,000 home, a buyer who is not a first-time buyer saves about $14,475 at closing by buying in Pickering, Ajax or Markham instead of Scarborough. That is real money, but it is a one-time cost. Commute, school, resale demand and property tax matter over the years you live there. I am happy to compare specific streets on both sides of the border with you.
Comparing homes inside and outside Toronto?
I will compare the full closing costs and monthly costs for the homes you are considering, so you can see the real difference.
This guide is general information, not financial, legal or tax advice. Programs, rates and rules change; confirm the details for your situation before you act. Mortgage information is provided by Ashraful Khan, Mortgage Broker, Lic. #M22000883, Mortgage Alliance Inc., FSRA Licence #10530. Real estate information is provided by Ashraful Khan, Sales Representative, Royal LePage Ignite Realty, Brokerage, Independently Owned and Operated.