Changes to the Land transfer Tax 

The Provincial government has announced the Following Changes to the Land Transfer Tax.

1. The rebate is increased for the first time buyer from $2,000.00 to $4,000.00, effective January 1, 2017

>> Deal must CLOSE after January 1, 2017. If closing is in 2016, this change does not benefit you/your client.

2. Following will be Land Transfer Tax Increases taking effect January 1, 2017

For Commercial, Industrial, Apartment Building or Vacant Land with purchase price more than $400,000, the tax rate will increase from 1.5% to 2%.

For Residential Purchase of More Than Two Million Dollars, the tax will increase from 2% to 2.5% for every dollar over two million.

If you/buyer signed purchase agreement BEFORE November 14, 2016, then buyer will still pay the current lower Land Transfer Tax, as long as closing is in 2017.

3. If you/your client buys a home in Toronto, you pay a second Municipal Land Transfer Tax at closing. So far there is NO CHANGE for Toronto’s Municipal Land Transfer Tax rates.

Who qualifies for the first time buyer rebate?

 To qualify for Land Transfer Tax rebate, buyer should not have owned a home previously, anywhere in the world.

Buyer should make this purchase as buyer’s primary residence within 9 months of closing. If buyer’s first home is an investment property, buyer does not qualify for the first time buyer rebate.

If buyer is married and if buyer’s spouse owned a home while spouse was married to the buyer, then buyer is not eligible for any Land Transfer Tax rebate.

But if buyer’s spouse sold his/her home BEFORE getting married, then buyer will still be eligible for the full rebate. Buyer will have to apply for half the rebate on closing and the other half within 18 months after closing. These rules also apply to common law spouses as well.

If buyer qualifies for the rebate and buys with buyer’s parents, who may be assisting with mortgage, then parents may not qualify for the rebate. But if buyer takes 99% of the title and parents 1%, buyer may still take 99% benefit of the rebate.

For Non Residents of the Canada there is no rebate in Land transfer Tax effective January 1, 2017. However, if buyer becomes a permanent resident within 18 months after closing, buyer can apply for the rebate.

————————————-For Real Estate or Mortgage Professional Services visit us at www.vijaygandhi.com or call us at direct line +1-647-267-6338

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Vijay Gandhi,

Sales Representative- REALTOR®

Homelife / Miracle Realty Ltd., Brokerage* 

Cell/SMS: 647.267.6338

Office: 416.289.3000 Fax: 416.289.3008

www.vijaygandhi.com | www.centumfirst.ca

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Disclaimer:
The above is for your information and knowledge purpose only and do not constitute any legal advice. You should always assess your situation by talking or getting advise from right professional or real estate lawyer to find out what if you qualify for any rebate and how much will be Land Transfer Tax for any particular transaction.

https://gtarealtyagent.wordpress.com/2016/11/18/update-on-changes-to-the-land-transfer-tax-effective-from-january-1-2017/

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