Published 2 November 2026 · By Jatin Dua, Broker of Record, RE/MAX Quantum Realty
Ontario sellers pay brokerage commission plus 13% HST, legal fees, any mortgage prepayment charge and lender fees, and property tax or condo fee adjustments. Sellers do not pay land transfer tax. Commission is negotiable under RECO rules. On a $1 million sale with a 4% commission, my example totals about 5.4%.
This guide is for Ontario homeowners who want to know exactly what comes out of the sale price before the money reaches their bank account. You will get every seller cost line by line, a worked example on a $1 million sale, and the questions to ask so nothing surprises you on closing day.
What closing costs does a seller pay in Ontario?
A seller in Ontario typically pays these costs on or before closing:
- Brokerage commission, plus 13% HST on it.
- Real estate lawyer’s fee and disbursements, plus HST.
- Mortgage payout: the balance, interest to the closing date, and any prepayment penalty.
- Mortgage discharge or administration fees charged by your lender.
- Adjustments for property tax, and for condos, the monthly fee.
- Condo status certificate, if the seller orders it.
- Moving, cleaning and any repairs you agree to make.
Sellers do not pay land transfer tax. Ontario’s Ministry of Finance states that the person acquiring the land pays it when the deal closes. Inside Toronto the same is true for the municipal land transfer tax.
How much is real estate commission for a seller in Ontario?
There is no set rate. The Real Estate Council of Ontario (RECO), the regulator, says commission is agreed between you and the brokerage and is not fixed or approved by RECO, any government or any real estate board. It can be a flat dollar amount, a percentage of the price, or a mix. The one thing it cannot be is the difference between the list price and the sale price.
Under RECO’s guidance, your listing agreement must also say whether you will pay anything toward the buyer’s brokerage, and how much. You can choose to offer nothing, but that can affect how much buyers are able to offer. Commission is subject to 13% HST. Because the fee is negotiable, here is what different agreed amounts would cost on a $1,000,000 sale:
| Total commission you agree to (example) | Commission | HST at 13% | Total cost |
|---|---|---|---|
| Flat fee of $15,000 | $15,000 | $1,950 | $16,950 |
| 2.5% of the price | $25,000 | $3,250 | $28,250 |
| 3.5% of the price | $35,000 | $4,550 | $39,550 |
| 4.5% of the price | $45,000 | $5,850 | $50,850 |
Source: RECO, Signing a contract with a real estate brokerage; CRA GST/HST rate (13% in Ontario). Amounts are illustrations, not typical or recommended rates.
Compare what each brokerage will actually do for that fee: photos, staging advice, marketing, open houses and how they handle offers. RECO says services are not standard, so anything not written in the agreement may not be provided. My guide to real estate commission in Ontario covers the details, and the holdover clause is the line to read twice before you sign.
How much are lawyer fees when selling a house in Ontario?
Legal fees vary by firm and by how complex the file is, so get a written quote before you list. A good quote separates the lawyer’s fee from disbursements (out-of-pocket costs such as searches, courier and registration) and shows the HST. Costs usually rise if there is more than one mortgage to pay out, a line of credit secured on the home, an estate sale, a power of attorney signing or a non-resident seller.
Your lawyer also prepares the statement of adjustments, receives the buyer’s funds, pays out your mortgage and your brokerage, and sends you the balance. See what a real estate lawyer does in Ontario for the full list.
How much does it cost to pay off a mortgage early when you sell?
If your mortgage is closed and the term has not ended, expect a prepayment charge. Major lenders publish how they calculate it:
- Closed variable rate: usually three months’ interest on the amount you pay off (RBC and First National both state this).
- Closed fixed rate: the greater of three months’ interest or an interest rate differential (IRD). The IRD compares your rate with the lender’s current rate for the time left on your term.
Example: $450,000 owing at 4.30% means three months’ interest of $4,837.50. An IRD can be much higher if rates have dropped since you signed, and the method differs between lenders. The Financial Consumer Agency of Canada lists other possible costs when you break a mortgage, including administration fees, a discharge fee, and repaying any cash back you received. Ask your lender for a written payout statement before you set your price. You may also be able to port the mortgage to your next home. Read what happens to your mortgage when you sell before you call your lender.
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What is a worked example of seller closing costs on a $1 million home?
Here is one illustration. It assumes a 4% total commission you have negotiated, a $450,000 variable-rate mortgage at 4.30% and example amounts for legal, discharge and moving costs. Replace each line with your own quotes.
| Line item on a $1,000,000 sale | Amount | Where the number comes from |
|---|---|---|
| Commission (4%, example only) | $40,000 | Your listing agreement |
| HST on commission (13%) | $5,200 | CRA HST rate |
| Legal fee and disbursements (example) | $1,500 | Your lawyer’s written quote |
| Prepayment charge (three months’ interest) | $4,837.50 | Lender payout statement |
| Discharge or admin fee (example) | $300 | Lender payout statement |
| Moving (example) | $2,500 | Mover’s quote |
| Total selling costs | $54,337.50 | About 5.4% of the price |
| Mortgage balance paid out | $450,000 | Lender payout statement |
| Cash to you before adjustments | $495,662.50 |
Source: my arithmetic; method for prepayment charges from RBC and First National. Example amounts are assumptions, not quotes.
Notice how much of the total is commission and its HST. That is the line where negotiating makes the biggest difference, so it is worth asking each brokerage exactly what is included.
What are property tax and condo fee adjustments on closing?
Adjustments make sure each side pays only for the days they own the home. If you already paid the full year’s property tax, the buyer credits you for the days after closing. If you are behind, you owe the difference. Condo fees work the same way for the month of closing. These appear on the statement of adjustments your lawyer prepares.
For condos, someone has to order the status certificate. The Condominium Authority of Ontario says the corporation can charge up to $100 including taxes and must provide it within 10 days of the request. Sellers sometimes order it early so buyers do not need a condition for it.
Do you pay tax when you sell your house in Ontario?
Usually no income tax if it was your home the whole time. The CRA says if a property was solely your principal residence for every year you owned it, you do not pay tax on the gain. You must still report the sale on Schedule 3 and Form T2091(IND). Since 2016, the exemption is only allowed if you report it, and a late designation can carry a penalty.
Two exceptions to watch: if you owned the home for less than 365 consecutive days, the CRA generally treats the profit as business income under the flipping rule, unless a qualifying life event applies. And if part of the home earned rent, part of the gain may be taxable. Resale homes do not carry HST in normal cases. See capital gains tax when you sell a home in Ontario for the details.
What optional costs do sellers often pay before listing?
Some costs are not required but are common, and they belong in your budget so your net figure is honest:
- Repairs and touch-ups such as paint, caulking, burnt-out bulbs and sticky doors. Small fixes remove easy reasons for a buyer to cut the price.
- Cleaning and decluttering, including a storage unit for the listing period if rooms are packed.
- Staging, either full furniture rental or a consultation using your own furniture.
- A pre-listing inspection, so you know about problems before a buyer’s inspector finds them.
- Carrying costs if you buy first: two sets of property tax, utilities, insurance and mortgage payments until the sale closes.
Ask for quotes before you spend. Each of these should earn back more than it costs, or save you time on the market. Carrying costs can add up quickly if a sale takes longer than planned, so set a firm budget and a time limit before you commit to buying first.
Rental water heater and furnace contracts can turn into a surprise cost if the buyer will not take them over and the contract requires a buyout. Read your contracts before listing; my guide to rental water heaters when selling explains what to check. Also confirm early whether more than one mortgage or line of credit is registered on your home, because each must be paid out and discharged.
Get three numbers in writing before you agree on a list price: the commission and what it includes, your lawyer’s all-in quote, and your lender’s payout statement with any penalty. Those three explain almost all of the gap between your sale price and your cheque. With GTA prices lower than a year ago, that net figure matters more than the headline price, so I always build a seller’s net sheet before we list.
What to do next
- Ask your lender for a payout statement and penalty estimate for your likely closing date.
- Get a written, all-in quote from a real estate lawyer.
- Interview at least two brokerages and compare services and total commission in writing.
- Check for rental equipment contracts, open permits and liens on title.
- Build a net sheet: price minus every line in the table above.
Need help with this? Talk to me.
I’m Jatin Dua, Broker of Record at RE/MAX Quantum Realty, and I’m the best agent to do this kind of work for you in Toronto and across the GTA. Over $100 million in GTA sales and 100+ families helped sell. Feel free to contact me any time: call or text 833-330-1925 or email [email protected].
Frequently asked questions
What are the average closing costs for a seller in Ontario?
There is no official average for Ontario seller closing costs, because the largest item, commission, is negotiable. In my worked example on a $1,000,000 Ontario sale in 2026, total costs were $54,337.50, about 5.4% of the price, with a 4% commission plus HST making up most of it. Your number depends on your commission, mortgage penalty and legal quote.
Is real estate commission negotiable in Ontario?
Yes. RECO, the Ontario real estate regulator, says commission is set by agreement between you and the brokerage and is not fixed or approved by RECO, the government or any real estate board. It can be a flat fee, a percentage or both, but it cannot be based on the difference between the list price and the sale price.
Does the seller pay land transfer tax in Ontario?
No. In Ontario the buyer pays land transfer tax when the deal closes, according to the Ministry of Finance. Inside the City of Toronto, the buyer also pays the municipal land transfer tax. A seller’s closing costs are mainly commission plus HST, legal fees, any mortgage prepayment charge and lender fees, and adjustments for property tax or condo fees.
Do sellers pay HST on real estate commission in Ontario?
Yes. Commission is a taxable service in Ontario, so the seller pays 13% HST on top of the agreed commission. For example, a $35,000 commission carries $4,550 in HST, for a total of $39,550. Legal fees are also subject to HST. The sale of a resale home itself normally does not carry HST.
How much is the mortgage penalty when selling a house in Ontario?
On a closed variable-rate mortgage, the penalty is usually three months’ interest; on a closed fixed rate, it is usually the greater of three months’ interest or an interest rate differential, according to lenders such as RBC and First National. Three months’ interest on $450,000 at 4.30% is $4,837.50. Ask your lender for a written payout statement.
Who pays for the status certificate when selling a condo in Ontario?
Either side can order and pay for an Ontario condo status certificate; it depends on what the agreement says. The Condominium Authority of Ontario says anyone can request one, the corporation can charge up to $100 including taxes, and it must deliver it within 10 days. Sellers sometimes order it before listing to speed up the sale.
Do I have to pay capital gains tax when I sell my house in Ontario?
Usually not, if the home was your principal residence for every year you owned it. The CRA still requires you to report the sale on Schedule 3 and Form T2091(IND), and a late designation can carry a penalty. If you owned it less than 365 days, the flipping rule generally taxes the profit as business income.
What fees come out of my sale proceeds on closing day in Ontario?
On closing day in Ontario, your lawyer pays out your mortgage balance, interest and any penalty, your brokerage’s commission and HST, and adds or subtracts adjustments for property tax and condo fees. The lawyer’s own fee and disbursements are also deducted. The balance is then sent to you. Ask for the statement of adjustments a few days before closing.
How can I lower my closing costs when selling a house in Ontario?
The biggest savings for an Ontario seller usually come from negotiating commission in writing and avoiding a large mortgage penalty. Ask your lender whether you can port your mortgage to your next home, or time the sale near your renewal date. Also clear rental equipment contracts early and compare written quotes from two or three real estate lawyers.
Sources
- RECO: Signing a contract with a real estate brokerage
- Ontario Ministry of Finance: Land transfer tax
- RBC: Understanding mortgage prepayment charges
- First National: Understanding prepayment charges
- FCAC: Breaking your mortgage contract
- Condominium Authority of Ontario: Status certificates
- CRA: Principal residence and other real estate
- CRA: GST/HST calculator and rates
Related reading
- How to Sell a House in Toronto, Step by Step (2027)
- Closing Costs on a New Build in Ontario: What Builders Add
About the author — Jatin Dua, Toronto and GTA real estate broker
I am Jatin Dua, Broker of Record and co-founder of RE/MAX Quantum Realty Inc., Brokerage, Unit 101, 799 The Queensway, Toronto. I work with buyers and sellers across Toronto and the GTA and have helped more than 100 families sell. Four-plus years of active GTA transactions and over $100 million in sales volume.
Reach me at [email protected] or 833-330-1925, or book a call.