Land Transfer Taxes When Purchasing a Home

Posted May. 27th 2011 under Taxes

Buyers in most areas will have to add Land Transfer Taxes to their closing costs.

Land transfer taxes are a part of the process unless you live in Alberta, Saskatchewan, or rural Nova Scotia. These taxes, levied on properties that are changing hands, are the responsibility of the buyer. Depending on where you live, taxes can range from a half a per cent to two per cent of the total value of the property.

Many provinces have multi-tiered taxation systems that can sometimes be difficult to understand. If you buy a property for $260,000 in Ontario, for example, .5 per cent is changed on the first $55,000, 1 per cent is changed on $55,000-$250,000, while the $250,000-$400,000 range is taxed at 1.5 per cent. Your total tax bill? $2,375.00

The following illustrates Land Transfer Taxes for Ontario.

ONTARIO

Up to $55,000 x .5% of total property value.
From $55,000 to $250,000 x 1% of total property value.
From $250,000 to $400,000 x 1.5% of total property value.
From $400,000 up x 2% of total property value.