Calculate Land Transfer Tax Ontario 2020

Calculating land transfer tax in Ontario for 2020 requires understanding the tax rates, exemptions, and how to apply them to your property transaction. This guide provides a step-by-step calculator and detailed explanation of the Ontario land transfer tax system for 2020.

How to Calculate Land Transfer Tax in Ontario 2020

The Ontario land transfer tax is calculated based on the purchase price of the property and the applicable tax rate. The tax is applied to the total purchase price of the property, minus any exemptions or deductions.

Land Transfer Tax Formula

Land Transfer Tax = (Purchase Price - Exemptions) × Tax Rate

To calculate your land transfer tax:

Determine the total purchase price of the property
Subtract any applicable exemptions or deductions
Multiply the remaining amount by the applicable tax rate

For example, if you purchase a property for $500,000 and there are no exemptions, and the tax rate is 1%, your land transfer tax would be $5,000.

Ontario Land Transfer Tax Rates 2020

The Ontario land transfer tax rates for 2020 are as follows:

Property Type	Tax Rate
Residential Property	1% of the purchase price
Commercial Property	1.5% of the purchase price
Farmland	0.5% of the purchase price

These rates apply to the total purchase price of the property, minus any exemptions or deductions.

Exemptions and Deductions

There are several exemptions and deductions that may apply to your land transfer tax calculation:

First-time homebuyer exemption: Up to $8,000 exemption for first-time homebuyers
Spouse exemption: Up to $400,000 exemption for spouses
Municipal property tax exemption: Up to $10,000 exemption for municipal property taxes
Capital gains exemption: Up to $100,000 exemption for capital gains

Note: Exemptions and deductions may vary depending on your specific situation. Consult with a tax professional for personalized advice.

How to Pay Your Land Transfer Tax

Land transfer tax must be paid to the Ontario government at the time of closing on your property purchase. You can pay the tax in one of the following ways:

Cash or certified cheque
Bank draft
Money order
Electronic funds transfer

The tax must be paid to the Ontario government, not to the seller or realtor. Failure to pay the tax may result in legal consequences.

FAQ

What is the land transfer tax rate in Ontario for 2020?: The land transfer tax rate in Ontario for 2020 is 1% for residential property, 1.5% for commercial property, and 0.5% for farmland.
Are there any exemptions for land transfer tax in Ontario?: Yes, there are several exemptions for land transfer tax in Ontario, including the first-time homebuyer exemption, spouse exemption, municipal property tax exemption, and capital gains exemption.
When do I need to pay the land transfer tax?: You need to pay the land transfer tax at the time of closing on your property purchase.
Who do I pay the land transfer tax to?: You need to pay the land transfer tax to the Ontario government, not to the seller or realtor.
What happens if I don't pay the land transfer tax?: Failure to pay the land transfer tax may result in legal consequences, including fines and penalties.