What’s the difference between Toronto’s and Ontario’s land transfer tax?
Selling a House? Toronto vs Ontario Land Transfer Tax — The One Thing Every Georgetown Seller Needs to Count
Quick headline answer
Buyers pay Ontario’s provincial Land Transfer Tax (LTT) across the province. If a property is in the City of Toronto, buyers pay an additional municipal Land Transfer Tax (MLTT). Georgetown sits in Halton (not Toronto), so buyers for Georgetown homes pay only the provincial LTT — unless they buy a property inside Toronto. That difference changes buyer affordability and how you price and market your home.
Why this matters if you’re selling in Georgetown, Ontario
You’re selling a house in Georgetown. Buyers are doing math: down payment, mortgage, closing costs, and land transfer tax. If buyers are comparing your home to similar properties inside Toronto, the extra municipal tax in Toronto can push buyers toward Georgetown — or it can reduce the pool of local buyers who can afford both.
This matters because:
- Buyers pay the LTT, not the seller. But it affects demand and final sale price.
- Toronto homes carry an extra cost (the municipal tax) that Georgetown homes don’t. That can be a selling advantage.
- Buyer expectations and negotiations will reflect those costs. If buyers know they save on MLTT by buying in Georgetown, they may expect price premiums or use that saving to negotiate.
Read on. I’ll strip the fluff and give you practical moves to keep more money when you sell.
The straightforward breakdown: Ontario LTT vs Toronto MLTT
- Ontario Land Transfer Tax (provincial LTT): A province-wide tax charged when property changes hands. It’s calculated on the purchase price in tiers.
- Toronto Municipal Land Transfer Tax (MLTT): A second tax charged by the City of Toronto, using similar tiered rates. It applies only to properties inside Toronto city limits.
How the taxes stack if a buyer purchases in Toronto:
- They pay both the provincial LTT and the Toronto MLTT — effectively doubling the tax brackets for the same purchase price.
How it applies to Georgetown:
- Georgetown is in Halton Region. There is no municipal LTT in Halton. Buyers of Georgetown homes pay only the provincial Ontario LTT.
Current LTT rate structure (practical, not theoretical)
(Use these tiers when estimating buyer costs — confirm with your lawyer before final numbers)
- 0.5% on the first $55,000
- 1.0% on the portion from $55,000 to $250,000
- 1.5% on the portion from $250,000 to $400,000
- 2.0% on the portion from $400,000 to $2,000,000
- 2.5% on the portion above $2,000,000
If a buyer purchases in Toronto, those provincial amounts are paid plus Toronto’s municipal tax, which mirrors the same tiered system — so the effective tax rate doubles in each band.
Note: First-time homebuyer rebates and other credits can reduce the provincial LTT. Toronto also offers a municipal rebate for eligible first-time buyers. Always confirm rebate details with your lawyer or mortgage advisor.
Actionable steps for Georgetown sellers (practical, direct)
- Price to leverage the tax advantage
- Market your home as a Toronto alternative. Buyers comparing Toronto listings will notice the absence of the municipal tax. Use that to justify a small premium.
- Educate buyers and their agents upfront
- Include a short note in your listing and marketing materials: “No Toronto municipal land transfer tax — see how this saves buyers.” Clear explanation reduces negotiation friction.
- Run a buyer-closing-costs sheet with your listing
- Show a sample breakdown: purchase price, estimated provincial LTT, typical legal fees, and leftover cash required. Buyers want certainty.
- Offer strategic incentives rather than price cuts
- If a buyer asks for concessions, consider offering a home warranty, flexible closing, or minor closing credit rather than lowering the list price. That preserves comparables and perceived value.
- Target Toronto buyers without overpromising
- Buyers relocating from Toronto will compare net cost. Show side-by-side comparisons (Toronto vs Georgetown net cost after tax). Be factual—don’t promise tax refunds or rebates.
- Work with a local lawyer and mortgage broker early
- LTT rebate eligibility, timing, and payment details can affect closings. Close coordination removes surprises and prevents delayed closings.
- Know the capital gains and HST landscape
- Resale single-family homes are generally exempt from HST. If you’re selling a second property or an income property, you may have capital gains — talk to an accountant to understand potential taxes and timing of the sale if you want to manage tax brackets.
Example: Simple math every seller should run
Imagine your Georgetown house sells for $800,000.
- Ontario LTT estimate (rough): 0.5% on first $55k = $275; 1% on next $195k = $1,950; 1.5% on next $150k = $2,250; 2% on remaining $405k = $8,100. Total ≈ $12,575 (paid by buyer).
If that same house were inside Toronto, the buyer would pay provincial ~ $12,575 plus municipal ~ $12,575 = ~$25,150 total in land transfer taxes. That difference matters to buyers and can be leveraged in marketing.
Messaging that sells: use this on your listing and ads
- “Save thousands on closing costs vs buying in Toronto — ask for a quick closing-cost comparison.”
- “Georgetown home: same commuter access, lower buyer closing costs.”
Keep it simple. Buyers don’t want tax lectures — they want to know how much they net out and what they need at closing.
What sells faster: price vs closing cost advantage?
Short answer: both. Price drives attention. The tax advantage is a closing-stage differentiator. Use both: set a competitive price and highlight the tax savings in marketing to capture both early interest and final-stage buyers.
Pitfalls sellers make — and how to avoid them
- Pitfall: Assuming buyers know LTT rules. Don’t. Put the numbers in writing.
- Pitfall: Pricing as if Toronto tax applies. That kills competitiveness. Price for Halton market conditions.
- Pitfall: Ignoring capital gains consequences. If this isn’t your principal residence, get an accountant involved early.
- Pitfall: Letting negotiations stall on perceived tax savings. Bring a mortgage broker or lawyer to the table to confirm buyer calculations quickly.
Final checklist for a clean closing (must-do)
- Confirm property is a principal residence or get tax advice if not.
- Provide a clear buyer-closing-costs sheet in your listing package.
- Coordinate with title lawyer to confirm LTT amounts and rebate options early.
- Use marketing to show Georgetown as a cost-smart alternative to Toronto.
- If you’re pricing above $1M+, factor how LTT shifts buyer elasticity and adjust strategy accordingly.
Call to action — get local expertise and a seller plan
Selling in Georgetown? You want someone who understands local buyers, Toronto comparisons, and how closing costs change demand. I handle the calculations, marketing, and negotiation to convert that tax gap into higher net proceeds for you. For a free, no-pressure seller consultation and a custom net-proceeds worksheet, contact Tony Sousa at tony@sousasells.ca or 416-477-2620, or visit https://www.sousasells.ca.
FAQ — Common questions Georgetown home sellers ask about land transfer tax and selling costs
Q: Do sellers pay land transfer tax?
A: No. Land transfer tax is typically paid by the buyer at closing. However, sellers feel the impact indirectly because buyer affordability and the market can change based on these taxes.
Q: Does Toronto’s municipal land transfer tax apply to Georgetown properties?
A: No. Toronto’s municipal LTT applies only to properties inside the City of Toronto. Georgetown sits in Halton Region, so buyers of Georgetown properties pay only Ontario’s provincial LTT.
Q: Are there rebates for first-time home buyers?
A: Yes. Ontario offers a provincial first-time homebuyer rebate that can reduce the provincial LTT. The City of Toronto also has a municipal rebate for eligible buyers in Toronto. Rebate eligibility has rules and application timelines — confirm with your lawyer.
Q: Will the existence of Toronto’s MLTT push more buyers to Georgetown?
A: It can. Some buyers look outside Toronto for similar value without the extra municipal tax. That creates demand for well-priced Georgetown homes. The real impact depends on price ranges, commute options, and buyer priorities.
Q: Do I need to worry about HST when selling my home?
A: Usually no for resale single-family homes — they’re generally exempt from HST. New builds or commercial/resale of certain properties may trigger HST. Consult an accountant if your sale involves a purpose-built income property or development parcels.
Q: What about capital gains tax when I sell?
A: If the property was your principal residence for every year you owned it, you likely qualify for the principal residence exemption and won’t pay capital gains tax. If it was a second property or rental, you’ll likely face capital gains tax on the taxable portion. Talk to an accountant early.
Q: How can I make my home more attractive to buyers who are worried about closing costs?
A: Provide transparent closing-cost worksheets, offer flexible closing dates, include small concessions like home warranties, and market the net savings compared to Toronto listings. This reduces buyer anxiety and speeds decisions.
Q: Who should I involve early in the sale process?
A: A local real estate agent who understands Georgetown and Toronto market dynamics, a real estate lawyer to confirm LTT and rebate rules, and a tax/accounting professional if you have potential capital gains or business-use considerations.
If you want a tailored seller strategy that turns tax differences into bargaining power and higher net proceeds, call Tony Sousa at 416-477-2620 or email tony@sousasells.ca. I’ll run the net-proceeds, the buyer-closing-costs comparison, and the marketing plan you need to sell fast and for more.
