Land Transfer Tax Refund for First-time Homebuyers

How much is the refund?

The maximum amount of the refund is $2,000. If the refund is claimed at time of registration, it may offset the land transfer tax ordinarily payable. If not claimed at registration, the refund may be claimed directly from the Ministry of Revenue. No interest is paid on this refund.

Who qualifies?

To claim a refund, you:

  • must be at least 18 years of age;
  • must occupy the home as your principal residence within 9 months of after the date of transfer; and
  • cannot have owned a home, or an interest in a home, anywhere in the world.

In addition:

  • your spouse cannot have owned a home, or an interest in a home, anywhere in the world while being your spouse; and
  • in the case of a newly constructed home, you must be entitled to a Tarion New Home Warranty.

How do I apply?

Qualifying taxpayers may claim an immediate refund at time of registration in one of two ways:

Refunds claimed at the Ministry of Revenue

Where a qualifying taxpayer is unable to claim the refund at registration, the tax will be payable at that time and a refund claim may be made directly to the Ministry of Revenue. The following documentation must be submitted in order for a refund claim to be processed:

  • A properly completed form – Ontario Land Transfer Tax Refund Affidavit For First-Time Purchasers of Eligible Homes [PDF - 350 KB];
  • A copy of the registered conveyance (transfer/deed). If not registered electronically, this should be a photocopy of the Land Registry Office's original which shows the tax paid;
  • A copy of the docket summary will also be required if the conveyance was registered electronically;
  • A copy of the agreement of purchase and sale, together with all schedules, amendments and assignments along with a copy of the statement of adjustments relating to the conveyance;
  • Proof of occupancy, with the new address listed, such as copies of telephone/cable bills, credit card statements, driver's licence, newspaper/magazine subscriptions, etc., and
  • For agreements of purchase and sale entered into before December 14, 2007, a copy of the Tarion New Home Warranty, which is also known as the Certificate of Completion and Possession.

 

Frequently Asked Questions

I inherited my mother's home from her estate. I did not buy the home. I only inherited it. Since I did not buy the home from my mother, do I qualify for the Land Transfer Tax Refund for First-time Homebuyers?

To claim a refund, you cannot have owned a home, or an interest in a home, anywhere in the world. Previous ownership in a home means you do not qualify. The method of acquiring the home (e.g., purchase, gift or through an inheritance) is not considered.

If a parent is also on title to a child's property at the insistence of the bank, is the child eligible for the refund as long as all of the other conditions are met?

In this situation, it will be necessary to pay land transfer tax at the time of registration and apply for a refund from the ministry.

If the parent did not acquire a beneficial interest in the property as a result of the conveyance:

  • the ministry will accept the fact that the parent was on title as a trustee for the child, and
  • the child would qualify for the newly constructed home refund, provided that evidence of the trust is submitted (e.g., a letter from the bank confirming that the parent is on title for mortgage purposes).

For further information refer to Ontario Tax Bulletin LTT 1-2005 – Conveyances Involving Trusts.

How do I apply for the refund of land transfer tax for first-time homebuyers?

Normally, upon registration, your lawyer will complete the appropriate tax statements in the electronic land registration system, and the refund will be deducted automatically from the land transfer tax that would otherwise be payable.

If this did not occur, after registration you can apply for the refund by submitting an application to the ministry consisting of the following documentation:

  • completed Land Transfer Tax Refund Affidavit For First-time Purchasers;
  • copy of the registered conveyance;
  • evidence of the amount of tax paid on registration;
  • copy of the Agreement of Purchase and Sale (including all schedules and amendments);
  • copy of the Statement of Adjustments; and,
  • copy of the Tarion new home warranty certificate (if applicable).

For further information, refer to Ontario Tax Bulletin LTT 1-2008 Land Transfer Tax Refunds For First-time Homebuyers.

My spouse and I are buying our first home together. I have owned a home before, but sold it before we became spouses. My spouse has never owned a home. Does she qualify for the First-time Homebuyers Refund?

Yes, even though you are not a first-time homebuyer, your spouse may claim a refund up to the maximum, as long as you did not own a home while you were each others "spouse."

Where a husband who is not a first-time purchaser and a wife who is a first-time purchaser, purchase a home together, the wife may claim the land transfer tax refund with respect to her interest and her husband's interest, if he sold his interest in all homes that he previously owned before becoming her spouse.

For land transfer tax purposes, "spouse" means either of two persons who are married to each other, or who are not married to each other and who have cohabited:

  • continuously for a period of not less than three years; or
  • in a relationship of some permanence, if they are the natural or adoptive parents of a child.

My partner and I are buying a home together. I have owned a home, but he has not. Does he qualify for the First-time Homebuyers Refund?

Your partner's eligibility for a refund depends on whether you are "spouses" as defined in section 29 of the Family Law Act.

For land transfer tax purposes, "spouse" means either of two persons who are married to each other, or who are not married to each other and who have cohabited:

  • continuously for a period of not less than three years; or
  • in a relationship of some permanence, if they are the natural or adoptive parents of a child.
    If you are not spouses, then your partner may claim a refund based on his/her interest acquired in the home.

If you are "spouses", your partner may claim a refund up to the maximum, as long as you did not own a home while you were each other's "spouse." If you did own the home while you were each other's "spouse", then your partner does not qualify for a refund even if you did not live in the house together.

What are the requirements to qualify for the refund of land transfer tax for first-time homebuyers?

The requirements are as follows:

  • The purchaser cannot have previously owned a home, or had any ownership interest in a home, anywhere in the world, at any time.
  • If the purchaser has a spouse, the spouse cannot have owned a home, or had any ownership interest in a home, anywhere in the world, while he or she was the purchaser's spouse. If this is the case, no refund is available to either spouse.
  • The purchaser must be at least 18 years of age.
  • The application for a refund must be made within 18 months after the date on which the conveyance or disposition occurred. (Note that an application for the refund can be completed upon the electronic registration of the conveyance).
  • The purchaser must occupy the home as his or her principal residence no later than nine months after the date of the conveyance or disposition.
  • The purchaser cannot have previously received an Ontario Home Ownership Savings Plan (OHOSP) based refund of land transfer tax.
  • If the agreement of purchase and sale is entered into before December 14, 2007, the home must be newly constructed.

 

 

Sitemap Privacy Policy Real Estate websites for Agents