Help Fight the New Toronto Home Buying Tax! Your Voice Matters

Home • Profile • Success • Home Value • Condo Evaluation • Map • Contact

REAL ESTATE UPDATE NEWS

TORONTO LAND TRANSFER TAX APPROVED

December 14, 2007 -- The City of Toronto has indicated that it has been able to make arrangements that will allow purchasers who are eligible for a FULL rebate of the Toronto Land Transfer Tax (TLTT) to close their transactions without paying the TLTT upfront (and then receiving a rebate at a later date). The City previously indicated that these arrangements would not be made until the “spring of 2008”, but has now indicated that changes will be made by February 1, 2008, when the Toronto land transfer tax takes effect.

Toronto land transfer tax is not payable on transactions closing before the tax takes effect on February 1, 2008. For transactions closing after the Toronto land transfer tax takes effect on February 1, 2008, the City of Toronto allows for certain rebates, as described below.

Details

According to the City, purchasers who are eligible for a FULL rebate of the Toronto land transfer tax will not have to pay the tax (meaning that they do not have to pay the tax upfront and be rebated later). This includes the following:

Purchasers who have entered into an Agreement of Purchase and Sale for a property on or before December 31, 2007; and

First-time home buyers where the total Toronto land transfer tax is $3,725 or less ($3,725 is the amount of TLTT payable on a home purchased for $400,000). First-time home buyers with Toronto land transfer tax payable above the maximum rebate amount of $3,725 (those purchasing homes above $400,000) will be required to pay the total Toronto land transfer tax, and then receive the maximum rebate of $3,725 at a later date from the City. Once all changes have been made to Teranet’s collection system, in the spring of 2008, these buyers will only have to pay the balance of the Toronto land transfer tax above $3,725.

More Information

Complete details of the Toronto land transfer tax are available by calling the City of Toronto at 416-338-0338.

Zeny Maninang

Sales Representative

HomeLife/Bayview

Realty Inc.

Real Estate Brokerage

Independently Owned & Operated

505 Highway 7 East Suite 201,

Thornhill, Ontario

L3T 7T1

Office:

(905) 889-2200

Toronto Line:

(416) 324-2822

Email:

zeny@sellhomestoronto.com

CALCULATE TORONTO LAND TRANSFER TAX

Calculator for Toronto Land Transfer Tax

and Ontario Land Transfer Tax

Toronto land transfer tax, on top of the provincial land transfer tax, at the following rates:

Residential:

0.5% of the amount of the purchase price up to and including $55,000

1% of the amount of the purchase price between $55,000 and $400,000

2% of the amount of the purchase price above $400,000
Commercial / Industrial / Etc.:

0.5% of the amount of the purchase price up to and including $55,000

1% of the amount of the purchase price between $55,000 and $400,000

1.5% of the amount between $400,000 and $40 million
1% of the amount above $40 million

DETAILS OF APPROVED TORONTO LAND TRANSFER TAX

When does this take effect?

February 1, 2008.

Are existing transactions grandfathered?

Yes. Any transactions where the purchaser and vendor have entered into an Agreement of Purchase and Sale for the property prior to December 31, 2007 will be rebated the full amount of the Toronto land transfer tax. The City has not yet provided clarification on how rebates will be administered. If your clients have concerns, they should check with their lawyer. Once the City of Toronto provides clarification, more information will be provided.

What about Agreements of Purchase and Sale signed after December 31, 2007 with closing dates before February 1, 2008?

Purchasers with a Purchase and Sale agreement signed after December 31, 2007 with a closing before February 1, 2008 will not be required to pay the Toronto Land Transfer tax.

What about Agreements of Purchase and Sale signed after December 31, 2007 with closing dates on or after February 1, 2008?

Purchasers with a Purchase and Sale agreement signed after December 31, 2007 with a closing on or after February 1, 2008 will be required to pay the full Toronto Land Transfer tax.

Where does this apply?

The Toronto land transfer tax only applies to transactions within the City of Toronto. This does NOT apply to property transactions outside of the City of Toronto.

Are first time home buyers affected?

First time home buyers of new AND re-sale homes will receive a rebate of the Toronto land transfer tax of up to $3,725 (this equals a 100% rebate on homes purchased for up to $400,000). The City has not yet provided clarification on how rebates will be administered. If your clients have concerns, they should check with their lawyer. Once the City of Toronto provides clarification, more information will be provided.

More detailed information will be provided once it is made available by the City. If you have questions, contact the City of Toronto at Access Toronto at 416-338-0338. Some information from the City is available here.

If you have questions, contact the City of Toronto at Access Toronto at 416-338-0338.

News Release | December 13, 2007 | Government of Ontario | Ministry of Finance

ONTARIO EXPANDS LAND TRANSFER TAX REFUND PROGRAM

(View this report in Pdf file)

First-time buyers of resale homes to benefit from new tax measure

The McGuinty government is giving all first-time homebuyers a break on land transfer tax by proposing to expand the Land Transfer Tax Refund Program to include purchases of resale homes, Finance Minister Dwight Duncan announced today.

"Expanding this Land Transfer Tax refund is an important part of our government's commitment to helping Ontarians buying their first home," Duncan said.

Effective midnight tonight, first-time buyers of resale homes, as well as newly constructed homes, would be eligible for a refund from the provincial government of up to $2,000 of the Land Transfer Tax paid.

The expanded Land Transfer Tax Refund Program for First-time Homebuyers is part of a package of new tax initiatives announced in the 2007 Fall Economic Outlook and Fiscal Review that would provide $1.4 billion in provincial tax relief for business and people over three years. The government is making strategic investments in people, communities and infrastructure to strengthen Ontario's economic advantage and help manufacturers and other sectors challenged by current economic conditions.

For more information please visit: http://www.gov.on.ca