Land Transfer Tax Ontario Calculator 2014

Ontario's land transfer tax is a property tax that applies when you buy or sell real estate in the province. This calculator helps you determine your 2014 land transfer tax liability based on the purchase price of the property and your eligibility for exemptions.

How the Land Transfer Tax Works in Ontario 2014

In 2014, Ontario implemented a land transfer tax (LTT) to generate revenue for provincial programs. The tax applies to the purchase of residential and commercial properties, with rates varying based on the property type and the buyer's eligibility for exemptions.

Key Points: The tax is calculated on the purchase price of the property, not the sale price. It applies to both first-time home buyers and existing homeowners. The tax is paid by the buyer at closing.

Who Pays the Tax?

The land transfer tax applies to:

Individuals purchasing residential property
Corporations purchasing commercial property
Trusts purchasing property

The tax does not apply to:

Government entities
Municipalities
Certain exempt properties (see below)

Calculation Method and Rates

The land transfer tax is calculated based on the purchase price of the property, minus any applicable exemptions. The tax rates for 2014 were as follows:

Property Type	Tax Rate
Residential property (first-time home buyers)	0.5% of purchase price
Residential property (existing homeowners)	1.0% of purchase price
Commercial property	1.5% of purchase price

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

Calculation Example

For a first-time home buyer purchasing a $400,000 residential property with no exemptions:

Taxable amount = $400,000 - $0 = $400,000
Tax = $400,000 × 0.5% = $2,000

Exemptions and Deductions

Several exemptions and deductions can reduce your land transfer tax liability:

Residential Property Exemptions

First-time home buyer exemption: Up to $25,000 of the purchase price is exempt
Spouse exemption: Up to $25,000 of the purchase price is exempt for the spouse
Down payment exemption: Up to 5% of the purchase price is exempt if it comes from a registered retirement savings plan (RRSP)

Commercial Property Exemptions

Small business exemption: Up to $50,000 of the purchase price is exempt for small businesses
Non-profit exemption: Up to $100,000 of the purchase price is exempt for non-profit organizations

Note: Exemptions are applied in the order listed above. The first exemption reduces the taxable amount first, then the next exemption applies to the remaining amount, and so on.

Worked Examples

Example 1: First-Time Home Buyer

Purchase price: $400,000

First-time home buyer exemption: $25,000

Taxable amount: $400,000 - $25,000 = $375,000

Tax rate: 0.5%

Tax: $375,000 × 0.5% = $1,875

Example 2: Existing Homeowner

Purchase price: $500,000

No exemptions

Taxable amount: $500,000

Tax rate: 1.0%

Tax: $500,000 × 1.0% = $5,000

Example 3: Commercial Property

Purchase price: $1,000,000

Small business exemption: $50,000

Taxable amount: $1,000,000 - $50,000 = $950,000

Tax rate: 1.5%

Tax: $950,000 × 1.5% = $14,250

Frequently Asked Questions

When is the land transfer tax due?: The tax is due at the time of closing when you purchase the property. It is not refundable.
Can I deduct the land transfer tax from my property taxes?: No, the land transfer tax is separate from property taxes and cannot be deducted from them.
Is the land transfer tax prorated for a partial year?: No, the tax is calculated on the full purchase price regardless of when the purchase occurs during the year.
Are there any penalties for underpayment of the land transfer tax?: Yes, if you underpay the tax, you may be subject to interest and penalties. It's important to pay the correct amount at closing.
Can I claim the land transfer tax as a deduction on my income tax return?: No, the land transfer tax is not deductible on your personal income tax return.