The land transfer tax (LTT) is a tax paid by purchasers of a property in Ontario. It is a marginal tax rate dependent on the purchase price of the property. Currently, Toronto is the only municipality that has an additional tax that buyers should be aware of.

If you are a first-time homebuyer, you likely qualify for a rebate of up to $4,000 from the provincial government, and up to $4,475 from the municipality of Toronto. To be eligible for the rebate, it is a requirement that:

• You are at least 18 years old,

• Never have owned a home anywhere in the world, at any time,

• Your spouse or common-law partner must not currently own a home,

• You must occupy the home as your principal residency within nine months of taking legal possession of the property,

• You must be either a Canadian citizen or a permanent resident.

If purchasing a property with a non-spouse or common-law partner who does not qualify for the rebate, then you will only be eligible for a rebate corresponding to your ownership share of the property.

In some specific circumstances, the LTT may be waived entirely. The following circumstances of transfers may be exempt from the LTT; this is not a conclusive list:

• A transfer between spouses, or a transfer of property from parents to children as a gift if there is no mortgage on the property;

• A transfer of property within your family in which the property in question is used for the primary purpose of farming, and the property will continue to be used for farming;

• A transfer of property in which the property is being donated to a registered charity

• In some circumstances, transfers of land to a family business for the purposes of enabling the recipient to continue business operations on the land in question.