What Taxes Do I Have To Pay When Buying Or Selling Real Estate
Homes Or Condominiums In Toronto
HARMONIZED SALES TAX (HST) is a 13% sales tax that applies to all goods and services purchased in Ontario. It is a harmonized tax in that it is a combined tax collected by both the federal and provincial governments. Out of the 13% HST, a 5% portion goes to the Federal government and 8% portion goes to the government of Ontario.
If you purchase a NEW condo or house from a builder HST will apply.
The HST does not apply on the purchase price of RESALE homes and condos but applies to all the services required in the purchase or selling of a property. This includes real estate commissions, lawyers' fees, moving costs and home inspections.
LAND TRANSFER TAXES (LTT) The Ontario Land Transfer Tax applies when one buys real estate in Ontario and does not apply to the Seller.
One can calculate it by going to my Land Transfer Tax Calculator. If one buys in Toronto, a second land transfer tax from the City of Toronto also applies. The Toronto Land Transfer Tax essentially doubles the amount of total land transfer tax a Buyer will pay.
Again, if you are considering buying in Toronto you can go to my Land Transfer Calculator to determine how much land transfer tax you will pay.
First time buyers can get a rebate of up to $4,000 which is equivalent to the first $368,000 of a property's value for the Ontario Land Transfer Tax and a rebate of up to $4,475 which is equivalent to the first $400,000 of a property's value for Toronto's land transfer tax.
FOREIGN SELLER'S TAX Be aware that there are tax implications for foreign owners when they sell property in Toronto. A foreign seller may be subject to a non-resident withholding tax of 25% on the sale price of the property. Further details can be found on the Canada Revenue Agency website. One should consult with their own accountant to fully understand the Canadian tax rules and implications of selling a property in Toronto as a foreign owner.
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purchase, sale and lease of real estate as part of a cooperative selling system. Canadian Real Estate Association Last Updated: 7/17/2019 11:15:50 AM