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The Land Transfer Tax
refund program for first-time buyers of newly built homes
program was introduced in 1996 as a temporary measure to
stimulate the housing industry and then on June 23, 2000,
the Land Transfer Tax Waiver Program received Royal Assent
in the Ontario Legislature, thus becoming a permanent
program.
People who are at least 18
years of age and have not previously owned an interest in
any home and whose spouse has not previously owned an
interest in any home during the time they are spouses of each
other, qualify as first time purchasers. To meet the
requirements for the refund, the qualified purchaser must be
purchasing a newly constructed home or an interest in a
newly constructed home and must use it as his/her principal
residence.
If there are more than one
purchaser for the home and you are the only one qualified
for the waiver, the amount will be reduced and calculated
according to the amount of interest in the home. For
example: If you own 100 per cent of your new home and you
paid $250,000, the amount of Land Transfer Tax payable is
$2,225. You will receive a refund of $2,000. If however, you
owned 50 per cent interest in your home, the amount will be
50 per cent of $2,000, or $1,000.
This refund is not
available if you have received an OHOSP based refund of land
transfer tax . If an individual qualifies for this refund as
well as the OHOSP based refund, it will be up to the first
time purchaser to decide which to claim. You may claim
either but not both.
You Need Not
"Apply" for the Refund
This program is better than
a "refund" because you don't have to pay the tax
and then claim it back; you get to waive it altogether,
subject to the allowable limit:
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If you buy a home where
the LTT normally payable is less than $2,000, you pay no
LTT on closing.
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If you buy a home where
the LTT normally payable is more than $2,000, you pay
only the difference.
This can be done by the
applicant filing an affidavit for refund at the Land
Registry Office at the time of registration. If you do not
apply for a refund at the time of registration, you will be
able to apply for the refund by contacting the Ministry of
Finance.
You can call the Ministry's
toll-free information line at 1-800-263-7965 (all areas of
Ontario) or (French language inquiries) 1 -800-668-5821.
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