A blog post about real estate taxes in Ontario? Could there be a more boring topic to read about? And yet, if you’re buying or selling a home, it’s important to understand all of the ways that you’ll be taxed. So grab a bowl of popcorn, get comfortable and get reading.
In this four-part series, we’ll look at:
• Land transfer taxes
• Property taxes
• HST
• Capital gains taxes
• Income tax implications
• Vacant home taxes
• Tax implications for non-resident home Buyers and Sellers.
Note: We aren’t accountants, so for specific advice about your personal situation or taxes, talk to an accountant.
For our first part of the series we will just talk about land transfer tax. It’s a great starting point with important numbers you’ll need to understand.
Land Transfer Taxes
In Ontario, the Buyer pays the land transfer tax (not the Seller). For those buying a home in Toronto, there is another land transfer tax. The formula to calculate both Land Transfer Taxes is below:
Ontario Land Transfer Tax:
• 0.5% of the value of the property up to and including $55,000
• 1% of the value which exceeds $55,000 up to and including $250,000 minus $275
• 1.5% of the value which exceeds $250,000 up to and including $400,000 minus $1,525
• 2% of the value which exceeds $400,000 up to and including $2,000,000 minus $3,525
• 2.5% for amounts exceeding $2,000,000, where the land contains one or two single-family residences minus $13,525
Toronto Land Transfer Tax:
• Same formula as above for Ontario Land Transfer Tax
If you don’t feel like doing all that math, use The Toronto Regional Real Estate Board Land Transfer Tax Calculator LTT Calculator – Residential – TRREB
But there’s good news for first-time Buyers: you may be eligible to receive a refund for all or part of the land-transfer tax - click for details of the Land Transfer Tax Refund Program.
Stay tuned for next week, where we will discuss property taxes!
As I said at the beginning of this blog post, talking about taxes is kind of boring and doesn't hold the excitement of looking at homes or the stress of submitting an offer on the house of your dreams. However, it's so important to know your bottom line. For example, your provincial Land Transfer Tax on a one million dollar ($1,000,000) property will be $16,475. If that house was also in Toronto you would pay a double Land Transfer Tax equaling $32,950! My parents only paid $20,000 for their house (although it was in the 50's).
If you have any further questions about this important topic or if you or anyone you know is thinking or buying, selling or both in the next little while, give me a call or pass on my number, 905-683-7800.
Thanks for reading today’s BLOG!!!
Brian Kondo
Sales Representative / Team Leader
The Brian Kondo Real Estate Team
Re/Max Hallmark First Group Realty Ltd.
905-683-7800 office
905-426-7484 direct
brian@briankondo.com
www.BrianKondo.com
www.BrianKondoTeam.com
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