The honest answer: Ontario charges a tiered Land Transfer Tax (LTT) on real estate purchases, ranging from 0.5% to 2.5% of purchase price. The City of Toronto charges an ADDITIONAL LTT at the same tiered rates — effectively doubling the bill for Toronto purchases. On a $1.2M home, that’s $20,475 outside Toronto and $40,950 inside Toronto. First-time buyer rebates can offset up to $8,475 combined.
Toronto home values: check a free, instant estimate for your home using our Toronto home value calculator.
Ontario LTT tiered rates (2026)
| Price band | Rate | Max tax on this band |
|---|---|---|
| $0 – $55,000 | 0.5% | $275 |
| $55,001 – $250,000 | 1.0% | $1,950 |
| $250,001 – $400,000 | 1.5% | $2,250 |
| $400,001 – $2,000,000 | 2.0% | $32,000 |
| $2,000,001+ | 2.5% | unlimited |
(The Ontario LTT tiers are MARGINAL — each band’s rate applies only to the portion of purchase price within that band, not the full price.)
Toronto Municipal LTT tiered rates
Toronto applies an ADDITIONAL LTT using the same tiered structure. For a $1.2M Toronto purchase, you pay BOTH the Ontario LTT AND the Toronto Municipal LTT.
Worked examples — Ontario LTT only (905 purchases)
$800,000 purchase:
- 0.5% × $55,000 = $275
- 1.0% × $195,000 = $1,950
- 1.5% × $150,000 = $2,250
- 2.0% × $400,000 = $8,000
- Ontario LTT total: $12,475
$1,200,000 purchase:
- 0.5% × $55,000 = $275
- 1.0% × $195,000 = $1,950
- 1.5% × $150,000 = $2,250
- 2.0% × $800,000 = $16,000
- Ontario LTT total: $20,475
$2,500,000 purchase:
- 0.5% × $55,000 = $275
- 1.0% × $195,000 = $1,950
- 1.5% × $150,000 = $2,250
- 2.0% × $1,600,000 = $32,000
- 2.5% × $500,000 = $12,500
- Ontario LTT total: $48,975
Worked examples — Toronto purchases (DOUBLE the LTT)
| Purchase price | Ontario LTT | Toronto LTT | Total LTT |
|---|---|---|---|
| $800,000 | $12,475 | $12,475 | $24,950 |
| $1,200,000 | $20,475 | $20,475 | $40,950 |
| $1,800,000 | $32,475 | $32,475 | $64,950 |
| $2,500,000 | $48,975 | $48,975 | $97,950 |
First-time home buyer rebates
Two separate rebates, both apply:
Ontario LTT rebate:
- Up to $4,000 refund (full Ontario LTT on the first ~$368,000 of purchase price)
- Applies automatically at closing through your lawyer
Toronto Municipal LTT rebate:
- Up to $4,475 refund
- Applies automatically at closing through your lawyer for Toronto purchases
Combined first-time buyer LTT savings: up to $8,475.
Eligibility requirements:
- You’re 18+ years old
- You have never owned a home anywhere in the world
- You will occupy the home as your principal residence within 9 months
- Your spouse (if married/common-law) has not owned a home during the relationship
- You are a Canadian citizen or permanent resident
Non-resident purchases — Non-Resident Speculation Tax (NRST)
Non-residents buying Ontario property pay an additional Non-Resident Speculation Tax of 25% of purchase price (raised from 20% in 2022, then to 25% in 2025). This is on TOP of regular LTT. There are limited exemptions (work permits, refugee status, etc.) — talk to a real estate lawyer if applicable.
For most Ontario buyers (Canadian citizens or PRs), NRST doesn’t apply.
How LTT gets paid
LTT is paid by the buyer at closing, through the lawyer:
- Your lawyer calculates the LTT amount (Ontario + Toronto if applicable)
- You provide funds for LTT alongside your down payment + closing costs (typically wire transfer or bank draft)
- Lawyer pays Ministry of Finance Ontario (and City of Toronto separately if applicable)
- First-time buyer rebates are automatically deducted from the LTT bill at closing — you pay the net amount
You never pay LTT separately — it’s bundled into your closing day cash needs.
LTT considerations sellers should know
Sellers DON’T pay LTT — only buyers do. But sellers should understand it because:
- Your buyer is calculating their total cost-of-purchase including LTT
- Toronto purchases face roughly $20K more in LTT than 905 equivalents — that affects buyer demand
- First-time buyers prefer purchases under $400K (where LTT rebates fully cover the tax) — affects condo + entry-level demand
For your specific situation, related: complete Toronto closing costs breakdown · first-time home buyer guide · free home value calculator.
Frequently asked questions
How much is land transfer tax in Toronto on a $1 million home?
Approximately $32,950 total ($16,475 Ontario + $16,475 Toronto Municipal). First-time buyers get up to $8,475 rebated — net LTT around $24,475.
Do 905 buyers pay Toronto Municipal LTT?
No. The Toronto Municipal LTT applies only to purchases within the City of Toronto boundaries. Mississauga, Markham, Vaughan, Richmond Hill, Oakville, Brampton, and other 905 municipalities only pay the provincial Ontario LTT. On a $1.2M purchase, that’s a $20,475 savings vs. a Toronto purchase.
When is land transfer tax paid?
At closing, by the buyer, through their real estate lawyer. The lawyer calculates the total LTT (Ontario + Toronto Municipal if applicable), subtracts any first-time buyer rebates, and remits to the government. Buyers provide funds via wire transfer or bank draft as part of closing day cash needs.
Can I avoid Land Transfer Tax legally?
Limited options. The main savings: first-time buyer rebates (up to $8,475 combined Ontario + Toronto). Otherwise, LTT applies on virtually all Ontario real estate purchases. Some specific exemptions exist for transfers between spouses, family-farm transfers, and corporate restructurings — talk to a real estate lawyer if your situation is unusual.
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 | Alex GoodmanSales Representative · RE/MAX Your Community Realty, Brokerage Alex Goodman is a Sales Representative with RE/MAX Your Community Realty, Brokerage, serving the Greater Toronto Area. He specializes in residential sales across Ontario — luxury, first-time buyer, and downsizing transactions — and maintains InstantCalculator.ca as a free public resource for Ontario homeowners researching their property value. |