Land Transfer Tax REFUND

The general consensus about the Land Transfer Tax is that it is pesky, expensive, and an unwelcome addition to the sale and purchase of every home. There are some intricate details to this tax that – if you purchase unadvised by a realtor – you may miss!

Here’s the breakdown:

The Land Transfer Tax applies to all transfers of land (“land” means homes, fixtures, property…everything) in Ontario.

First Time Homebuyers are the lucky demographic who qualify for a rebate of The Land Transfer Tax from the Government of Ontario.

At the time of purchase and sale, real estate transactions are subject to the Harmonized Sales Tax (HST). If you are purchasing a new build, you qualify for a HST refund of up to $24,000. If you’re buying a resale, you qualify for a rebate of up to $2,000 which may offset the price of the Land Transfer Tax. This is the Gov’s way of helping you out a little on the cost of tax at the time of purchase.

Here is a clear breakdown:

How much is the refund?

The maximum amount of the refund is $2,000. If the refund is claimed at time of registration, it may offset the land transfer tax ordinarily payable. If not claimed at registration, the refund may be claimed directly from the Ministry of Revenue. No interest is paid on this refund.

Who qualifies?

To claim a refund, you:

must be at least 18 years of age;
must occupy the home as your principal residence within 9 months of after the date of transfer; and
cannot have owned a home, or an interest in a home, anywhere in the world.

In addition:

your spouse cannot have owned a home, or an interest in a home, anywhere in the world while being your spouse; and
in the case of a newly constructed home, you must be entitled to a Tarion New Home Warranty.

How do I apply?

Qualifying taxpayers may claim an immediate refund at time of registration in one of two ways:

If registering electronically, by completing the required statements under the “explanation” tab of the electronic affidavit.
If registering on paper, by filing an Ontario Land Transfer Tax Refund Affidavit For First-time Purchasers of Eligible Homes [fusion_builder_container hundred_percent=”yes” overflow=”visible”][fusion_builder_row][fusion_builder_column type=”1_1″ background_position=”left top” background_color=”” border_size=”” border_color=”” border_style=”solid” spacing=”yes” background_image=”” background_repeat=”no-repeat” padding=”” margin_top=”0px” margin_bottom=”0px” class=”” id=”” animation_type=”” animation_speed=”0.3″ animation_direction=”left” hide_on_mobile=”no” center_content=”no” min_height=”none”][ PDF – 350 KB ] at the Land Registry Office.

No matter how many times you read about the Land Transfer Tax and HST, it’s easy to be confused. Don’t worry! That’s why realtors are here. I know how to explain these taxes, how to work them into your budget, and how to help you apply for the rebates within 18 months after purchase.

Consult me before you buy or sell your home – I’ll make it easy for you to find and afford your dream home!