Published 2 November 2026 · By Jatin Dua, Broker of Record, RE/MAX Quantum Realty
No. In Ontario the buyer pays land transfer tax when the sale closes, not the seller. In Toronto the buyer also pays the municipal land transfer tax. As a seller you pay other costs, such as commission, legal fees and any mortgage penalty, and you pay land transfer tax only on the next home you buy.
This guide is for Ontario homeowners who are about to sell and want to know whether land transfer tax will come out of their sale proceeds. You will get the straight answer, the 2026 rates your buyer pays in and outside Toronto, how the tax affects your price and your next purchase, and the special cases for family and spousal transfers.
Who pays land transfer tax in Ontario, the buyer or the seller?
The buyer pays. Ontario’s Ministry of Finance says that when you acquire land or an interest in land, you pay land transfer tax to the province when the transaction closes. The tax falls on the person getting the property, not the person giving it up.
In practice, the buyer’s lawyer handles the payment as part of closing the deal. As the seller, you never see a land transfer tax bill, and it does not come off your sale proceeds.
That said, land transfer tax still matters to you in three ways:
- It is cash your buyer must find on top of the down payment, which limits what they can offer.
- You will pay it yourself on the next home you buy.
- If you transfer a home to family or a spouse, the person receiving it may owe it, depending on how the deal is set up.
Does the seller pay Toronto’s municipal land transfer tax?
No. Inside the City of Toronto, buyers pay a second tax, the Municipal Land Transfer Tax, in addition to the provincial one. The City applies it to purchases of property in Toronto. Like the Ontario tax, it is a cost of buying, not selling.
So a Toronto seller pays neither land transfer tax on the sale. A Toronto buyer pays both, which roughly doubles the bill compared with a buyer in Mississauga, Vaughan or Markham. My guide to land transfer tax in Toronto covers the buyer’s side in more detail.
How much land transfer tax will my buyer pay?
Ontario’s tax is charged in brackets on the value of the consideration, which is mainly the price plus any debt the buyer takes over. HST is not included. For a home with one or two single-family residences, the 2026 Ontario rates are:
| Part of the price | Ontario rate | Toronto municipal rate |
|---|---|---|
| Up to $55,000 | 0.5% | 0.5% |
| $55,000 to $250,000 | 1.0% | 1.0% |
| $250,000 to $400,000 | 1.5% | 1.5% |
| $400,000 to $2,000,000 | 2.0% | 2.0% |
| $2,000,000 to $3,000,000 | 2.5% | 2.5% |
| $3,000,000 to $4,000,000 | 2.5% | 4.40% |
| $4,000,000 to $5,000,000 | 2.5% | 5.45% |
Source: Ontario Ministry of Finance, Calculating Land Transfer Tax; City of Toronto, MLTT Rates and Fees (higher Toronto rates above $3 million took effect 1 April 2026; Toronto has further brackets above $5 million).
Here is what a buyer pays at common GTA prices:
| Sale price | Ontario tax (anywhere in Ontario) | Toronto municipal tax | Total for a Toronto buyer |
|---|---|---|---|
| $600,000 | $8,475 | $8,475 | $16,950 |
| $800,000 | $12,475 | $12,475 | $24,950 |
| $1,000,000 | $16,475 | $16,475 | $32,950 |
| $1,500,000 | $26,475 | $26,475 | $52,950 |
| $2,500,000 | $48,975 | $48,975 | $97,950 |
| $3,500,000 | $73,975 | $83,475 | $157,450 |
Source: my calculations from the Ontario and City of Toronto rate tables above, before any first-time buyer refund or rebate.
First-time buyers can get some of this back. Ontario refunds up to $4,000, and Toronto rebates up to $4,475 of its municipal tax, if the buyer meets the rules.
Why does my buyer’s land transfer tax matter when I sell?
Because it comes out of the same pocket as your price. Land transfer tax is due on closing, on top of the down payment. A Toronto buyer at $1,000,000 needs $32,950 for land transfer tax on top of a minimum down payment of $75,000 and their legal fees.
That has a few effects on sellers:
- Toronto sellers compete with the 905. A buyer comparing a $1,000,000 house in Toronto with one in Mississauga saves $16,475 in tax by buying outside the city. That gap is part of why some buyers drift to the suburbs.
- Price thresholds matter. Above $2,000,000 the rate rises, and in Toronto it jumps again above $3,000,000. Buyers notice these lines when they set their budgets.
- First-time buyers have a little more room. The refunds help them most on lower-priced homes.
Instant Home Valuation
What’s your home
worth today?
Answer six quick questions and get an instant value range built from current Toronto & GTA sale data — property type, size, condition, lot and location all weighted the way a real pricing conversation weighs them. Takes about ninety seconds.
Reading recent GTA sale data…
Building your estimate
Estimated market value
—
$0–$0
Most likely value $0 · roughly $0 per square foot
What moved the number
Starting from the area baseline for your property type, here’s what each answer added or subtracted.
Market context
Recent local averages for comparison.
—
A range is a starting point.
A strategy is what sells.
This model doesn’t know that your neighbour’s identical semi went $80,000 over asking last month, or which two upgrades actually pay back in your area. That conversation is free and takes twenty minutes.
Will I pay land transfer tax on the next home I buy?
Yes. When you sell and then buy, you are the buyer on the second deal, so you pay land transfer tax on that purchase. Plan for it in your moving budget.
You will not usually qualify for the first-time buyer refunds. Ontario’s refund is only for buyers who have never owned a home or an interest in a home anywhere in the world, and the same applies to a spouse who owned a home while married to the buyer. Toronto’s rebate has a similar rule. If you are selling a home you own, you have already owned one.
Two worked examples for sellers who are buying again
Downsizing into a Toronto condo. A couple sells a family home and buys a $900,000 condo in Toronto. They pay $14,475 in Ontario land transfer tax and another $14,475 to the City, for $28,950. The same condo price in Mississauga would cost them $14,475.
Moving up in York Region. A family sells a townhouse and buys a $1,500,000 detached house in Markham. They pay $26,475 in Ontario land transfer tax and no municipal tax, because Markham is outside Toronto. If they bought the same house in Toronto, the bill would be $52,950.
In both cases the tax is paid on the purchase, not the sale, and it comes out of the money the sellers hoped to put toward their next down payment. If your plan depends on a certain amount of cash from your sale, subtract the land transfer tax on your next home first.
If your purchase closes before your sale, you need the land transfer tax and down payment in cash before your sale money arrives. Some buyers in that spot use a bridge loan. My guide to bridge financing in Ontario explains how it works.
Moving from outside Toronto into the city can surprise people. A seller in Vaughan who buys a $1,500,000 house in Toronto pays $52,950 in land transfer tax, not $26,475. Get the exact figure from your lawyer before you firm up your purchase, so your budget is not short on closing day.
What does a seller pay instead of land transfer tax?
Sellers have their own closing costs, and they can add up. The main ones are:
- Real estate commission, plus 13% HST on the commission.
- Your lawyer’s fees and disbursements.
- Any mortgage prepayment charge or discharge fee.
- Property tax and condo fee adjustments for the days you have prepaid or still owe.
- Moving, repairs, cleaning and staging, if you choose to do them.
I list each item with real numbers in my guide to seller closing costs in Ontario for 2027. If you live outside Canada, there are separate federal withholding rules on your sale. See my guide to section 116 for non-resident sellers.
Do you pay land transfer tax when you transfer a house to family or a spouse?
The person receiving the property is the one who may owe tax, not the person giving it. How much depends on what they give in return:
- A sale to family. Tax is based on the price paid plus any mortgage the buyer takes over, whatever the family relationship.
- A gift with no mortgage. If no consideration passes in any form, the tax is nil.
- A gift where the mortgage moves too. The mortgage balance counts as consideration, so tax is charged on that amount.
- Transfers between spouses or former spouses. Some are exempt, for example where the only consideration is taking over a registered mortgage, or where the transfer follows a written separation agreement or a court order.
Family transfers also have income tax effects. Speak to a real estate lawyer and an accountant before you move a property to a relative.
Does the non-resident speculation tax affect sellers?
Not directly. Ontario’s Non-Resident Speculation Tax is paid by foreign nationals, foreign corporations and taxable trustees who buy residential property anywhere in Ontario. Since 25 October 2022 the rate is 25% of the full value of the consideration. Each buyer on the deal can be liable if one of them is a foreign buyer.
For a seller, the effect is on demand. Few foreign buyers will pay a 25% tax, so most homes sell to Canadian citizens and permanent residents. My guide to the non-resident speculation tax in Ontario covers who pays and who is exempt.
When I sit down with a seller, I build two budgets: what they will net on the sale, and what they will spend on the next purchase, including land transfer tax. Most people focus on the first and forget the second. If the move is from the suburbs into Toronto, the land transfer tax alone can decide which house you can afford next.
What to do next
- Work out your net proceeds from the sale using a seller closing cost list.
- Calculate land transfer tax on your next home, and add Toronto’s tax if you are buying in the city.
- Check whether your purchase will close before your sale, and line up bridge financing if it will.
- If you plan to move a property to family or a spouse, get advice from a real estate lawyer and an accountant first.
- Ask your lawyer for a written statement of adjustments estimate before closing day.
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
Does the seller pay land transfer tax in Ontario?
No. In Ontario the buyer pays land transfer tax when the sale closes, according to the Ministry of Finance. The seller pays nothing toward it, and it does not reduce the seller’s proceeds. Sellers pay other costs instead, such as commission plus HST, legal fees, any mortgage prepayment charge and property tax adjustments, as of 2026.
Who pays the Toronto land transfer tax, buyer or seller?
The buyer pays Toronto’s Municipal Land Transfer Tax, on top of Ontario’s land transfer tax, when buying property in the City of Toronto. The seller pays neither. On a $1,000,000 Toronto home in 2026, the buyer owes $16,475 to Ontario and $16,475 to the City, for $32,950 in total, before any first-time buyer refund or rebate.
How much is land transfer tax on a $1 million house in Ontario?
Ontario land transfer tax on a $1,000,000 home is $16,475 in 2026, paid by the buyer. Inside the City of Toronto the buyer also pays $16,475 in municipal land transfer tax, for a total of $32,950. A first-time buyer who qualifies can get up to $4,000 back from Ontario and up to $4,475 from Toronto.
Do I pay land transfer tax when I sell and buy another house in Ontario?
You pay land transfer tax only on the house you buy, not the one you sell. On a $1,500,000 purchase outside Toronto, that is $26,475 in 2026; inside Toronto it is $52,950. Because you already own a home, you will not usually qualify for Ontario’s or Toronto’s first-time buyer refunds.
Can the seller pay part of the buyer’s land transfer tax?
There is no rule that makes the seller pay any land transfer tax in Ontario; the law puts it on the buyer. Any incentive a seller offers to help a buyer with closing costs is a price term the two sides negotiate, and it can affect the value the tax is charged on. Have a real estate lawyer write and review any such term.
Do you pay land transfer tax when you gift a house to family in Ontario?
Not if nothing is given in return. Ontario says a transfer with no consideration in any form has a nil value, so no land transfer tax applies. But if the family member takes over a mortgage, tax is charged on the mortgage balance whatever the relationship. A gift also has income tax effects, so confirm with a lawyer and an accountant.
Is there land transfer tax when transferring a house to a spouse in Ontario?
Some spousal transfers in Ontario are exempt. The exemption can apply between spouses or former spouses where the only consideration is taking over a registered mortgage, or where the transfer follows a written separation agreement or a court order. Other spousal transfers may be taxed. Have a real estate lawyer confirm your case before registering the transfer.
When is land transfer tax paid in Ontario?
Land transfer tax is paid on closing, when the transfer of the property is registered. The buyer’s lawyer collects the money from the buyer and pays it as part of registering the deed. The buyer needs this amount in cash on top of the down payment, so it should be in the closing budget well before the closing date.
Do sellers pay the non-resident speculation tax in Ontario?
No. Ontario’s Non-Resident Speculation Tax is paid by foreign nationals, foreign corporations and taxable trustees who buy residential property, at 25% since 25 October 2022. Sellers do not pay it. Non-resident sellers face separate federal rules on their sale proceeds, so they should speak to an accountant and a lawyer early.
Sources
- Ontario Ministry of Finance: Land transfer tax
- Ontario Ministry of Finance: Calculating land transfer tax
- Ontario Ministry of Finance: Land transfer tax refunds for first-time homebuyers
- Ontario Ministry of Finance: Transactions for nominal consideration
- Ontario Ministry of Finance: Transfers of land between spouses
- City of Toronto: Municipal Land Transfer Tax rates and fees
- City of Toronto: Municipal Land Transfer Tax rebate opportunities
- Ontario Ministry of Finance: Non-resident speculation tax
Related reading
- Seller Closing Costs in Ontario for 2027: Every Fee Before You Get Paid
- How to Sell a House in Toronto, Step by Step (2027)
- Closing Costs on a New Build in Ontario: What Builders Add
- How Much Is My House Worth in Caledon? (2027)
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.