Buying a home in Toronto involves a closing cost that buyers outside the city do not face: the Toronto Municipal Land Transfer Tax. A Toronto purchaser will generally pay both Ontario Land Transfer Tax and Toronto Municipal Land Transfer Tax when the purchase closes.
For many buyers, these two taxes are among the largest expenses after the down payment. They must usually be paid on closing and generally cannot simply be added to a conventional mortgage. Knowing the likely amount before signing an Agreement of Purchase and Sale can prevent an unwelcome shortfall at closing.
This guide explains how Toronto land transfer tax works in 2026, how much a buyer may pay, the first-time home buyer rebates that may be available, and why early advice from a Toronto real estate lawyer matters.
Why Do Toronto Home Buyers Pay Two Land Transfer Taxes?
Ontario charges provincial Land Transfer Tax on purchases of land in the province. The City of Toronto also imposes its own Municipal Land Transfer Tax, commonly called the Toronto MLTT, on properties purchased within Toronto.
As a result, someone buying in Toronto will generally pay:
1. Ontario Land Transfer Tax; and
2. Toronto Municipal Land Transfer Tax.
This is often described as Toronto’s βdouble land transfer tax.β The taxes are separate from legal fees, title insurance, registration charges, property-tax adjustments and other closing costs.
The municipal tax applies to Toronto properties, including many detached homes, semi-detached homes, townhouses and condominium units. A property just outside Toronto may still attract Ontario Land Transfer Tax, but not the Toronto MLTT.
Toronto Municipal Land Transfer Tax Rates for 2026
Toronto uses graduated tax brackets. This means that the applicable rate is charged only on the portion of the purchase price falling within each bracketβnot on the entire price.
For qualifying residential property containing one or two single-family residences, the Toronto MLTT rates are:
| Portion of Purchase Price | Toronto MLTT rate |
| Up to and including $55.000 | 0.5% |
| Over $55,000 up to $250,000 | 1.0% |
| Over $250,000 up to $400,000 | 1.5% |
| Over $400,000 up to $2,000,000 | 2.0% |
| Over $2,000,000 up to $3,000,000 | 2.5% |
| Over $3,000,000 up to $4,000,000 | 4.4% |
| Over $400,000 up to $5,000,000 | 5.45% |
| Over $5,000,000 up to $10,000,000 | 6.5% |
| Over $10,000,000 up to $20,000,000 | 7.55% |
| Over $20,000,000 | 8.6% |
The revised Toronto rates above $3 million took effect on April 1, 2026. Different treatment may apply to other property types, so purchasers of mixed-use, commercial, multi-residential or unusual properties should obtain advice based on the specific transaction.
Example: Land Transfer Tax on a $1 Million Toronto Home
Suppose you purchase a Toronto home for $1,000,000.
The Ontario Land Transfer Tax is approximately $16,475. The Toronto Municipal Land Transfer Tax is also approximately $16,475, before any available rebate. That produces a combined land transfer tax cost of approximately $32,950.
An eligible first-time buyer who receives the maximum Ontario rebate of $4,000 and maximum Toronto rebate of $4,475 could reduce that combined amount by as much as $8,475, leaving approximately $24,475 in combined land transfer tax.
This example covers land transfer taxes only. A Toronto home buyer should also budget for legal fees, title insurance, registration expenses, adjustments, moving expenses and any applicable lender costs.
Is There a Toronto First-Time Home Buyer Rebate?
Yes. An eligible first-time purchaser may receive a Toronto MLTT rebate of up to $4,475. A separate Ontario Land Transfer Tax refund of up to $4,000 may also be available. Together, the maximum potential relief is $8,475.
For the Toronto rebate, the City states that a purchaser must meet requirements that include the following:
β’ The purchaser must be at least 18 years old.
β’ The purchaser must occupy the home as their principal residence no later than nine months after the purchase.
β’ The purchaser must not previously have owned a home, or held any ownership interest in a home, anywhere in the world.
β’ If the purchaser has a spouse, the spouse must not have owned a home anywhere in the world while they were the purchaser’s spouse.
β’ The purchaser must be a Canadian citizen or permanent resident, subject to the rules for someone who obtains that status within 18 months after the transfer.
The precise provincial and municipal tests should be reviewed before a rebate is claimed. An earlier interest in a homeβeven an interest acquired through family arrangements, inheritance, a trust or a nominal title arrangementβcan create an issue that needs legal analysis. Buyers should not assume they qualify simply because they have never bought a home in their own name or never lived in a property they previously owned.
What If Only One Buyer Is a First-Time Home Buyer?
This frequently arises when a first-time buyer purchases with a spouse, parent, sibling or co-investor who has previously owned a home.
The available rebate may be affected by:
β’ each purchaser’s percentage interest in the property;
β’ whether the purchasers are spouses;
β’ whether a spouse owned a home during the relationship;
β’ whether every person taking title meets the applicable requirements; and
β’ the actual beneficial ownership arrangement.
Adding someone to title solely to satisfy a lender can also have tax and legal consequences. The ownership structure should be discussed with the real estate lawyer before the Agreement of Purchase and Sale is finalized and well before closing documents are prepared.
Can You Claim the Toronto Rebate After Closing?
In some circumstances, yes. If the full Toronto MLTT was paid on registration, an eligible buyer may submit a rebate application afterward. According to the City of Toronto, the completed application and supporting documents must be received within 18 months after the conveyance or disposition.
Supporting material can include the registered transfer, Agreement of Purchase and Sale, Statement of Adjustments, proof of citizenship or permanent-resident status, and acceptable proof that the purchaser occupied the property within nine months. The City notes that utility and property-tax bills are not accepted as proof of occupancy for this purpose, although documents such as a driver’s licence or telephone/cable bill may be accepted.
Do not wait until the deadline is approaching. Missing documents, inconsistent addresses or questions about prior ownership can delay or jeopardize a claim.
Foreign Buyers May Face Additional Toronto Tax
Since January 1, 2025, Toronto’s Municipal Non-Resident Speculation Tax applies at a rate of 10% of the purchase price to certain residential purchases by foreign buyers. This municipal tax can apply in addition to Toronto MLTT and other applicable provincial or federal rules The definitions, exemptions and potential rebates are technical. Foreign nationals, foreign corporations, trustees and purchasers buying with a non-resident should obtain legal and tax advice before signing an agreement. The cost can be substantial, and the identity of every purchaser matters.
Other Toronto Closing Costs Buyers Should Expect
Land transfer tax is only one part of the money required to close a Toronto real estate purchase. Depending on the transaction, a buyer may also need funds for:
β’ the balance of the down payment;
β’ real estate legal fees and HST;
β’ title insurance;
β’ land-registration and search costs;
β’ property-tax, common-expense, rent or utility adjustments;
β’ lender appraisal or administration fees;
β’ mortgage insurance premiums where applicable;
β’ status-certificate costs for a condominium purchase; and
β’ HST or rebate-related amounts on certain new-construction purchases.
A reliable closing-cost estimate must be based on the actual purchase price, property type, intended ownership, mortgage and buyer eligibility. An online Toronto land transfer tax calculator can be a useful starting point, but it does not replace a transaction-specific legal review.
Why Speak With a Toronto Real Estate Lawyer Before Signing?
Many buyers contact a lawyer only after the deal is firm. By then, it may be too late to change important terms without the seller’s consent.
Early legal advice can help a purchaser:
β’ estimate Ontario and Toronto land transfer tax;
β’ assess first-time home buyer rebate eligibility;
β’ choose an appropriate ownership structure;
β’ identify non-resident tax concerns;
β’ review financing, condominium and title issues;
β’ negotiate useful conditions in the Agreement of Purchase and Sale; and
β’ calculate the funds required for closing.
In a competitive Toronto real estate market, knowing the true cost of the transaction before making an offer is just as important as knowing the purchase price.
Speak With a Toronto Real Estate Lawyer
If you are buying a house, condominium or investment property in Toronto, Capulli Law LLP can assist with the legal work from the review of the Agreement of Purchase and Sale through to closing. We can explain the land transfer taxes, available rebates, title issues and closing costs that may apply to your transaction.
Contact Capulli Law LLP β Toronto Real Estate & Construction Law before signing your agreement or as early as possible in the purchase process.
This article provides general information only and is not legal or tax advice. Land transfer tax rules, rates and rebate requirements may change. Advice should be obtained regarding the facts of a particular transaction.
Related Articles:
Ontarioβs New HST Rebate for New Homes: What Toronto and GTA Buyers Need to Know Before Closing
Ontarioβs New HST Rebate for New Homes: What Toronto and GTA Buyers Need to Know Before Closing
Additional Sources:
City of Toronto: MLTT rates and fees
City of Toronto: MLTT rebate opportunities
City of Toronto: MLTT and MNRST information
Ontario: Land Transfer Tax refunds for first-time homebuyers