At its meeting on February 15, 2017, Toronto City Council adopted amendments to chapter 760 of the City's Municipal Code to introduce new brackets and rates for the Municipal Land Transfer Tax (MLTT) effective March 1, 2017. The City describes the changes as "based on harmonizing the City's tax structure with the recently announced Provincial Land Transfer Tax (Provincial LTT) changes that were implemented on January 1, 2017." Unlike the recent Provincial LTT changes, however, the MLTT changes do not contemplate grandfathering of transactions entered into prior to their announcement or their effective date.
For residential properties in Toronto (i.e., those with one or two single family residences), there will be two new brackets, in each case with higher rates to apply:
- the portion of consideration exceeding $250,000 up to $400,000 will be taxed at 1.5% (vs. the current 1.0% applicable to the existing bracket of over $55,000, up to $400,000) and
- the portion of the consideration exceeding $2 million will be taxed at 2.5% (vs. the current 2.0% applicable to the existing bracket of over $400,000).
For all other properties in Toronto, one new bracket will be created and two others consolidated into one, in each case with higher rates to apply:
- the portion of consideration over $250,000 up to $400,000 will be taxed at 1.5% (vs. the current 1.0% applicable to the existing bracket of over $55,000, up to $400,000) and
- the portion of consideration over $400,000 will be taxed at 2.0% (vs. the current 1.5% for consideration over $400,000, up to $40 million and vs. the current 1% for consideration over $40 million).
The tables below show the existing rates and brackets as well as those which will apply as of March 1, 2017. As always, tax at these rates is in addition to applicable Provincial LTT.
The first-time homebuyer rebate program rules have also been changed to make them consistent with the new provincial rules which became effective January 1, 2017.
| Land with one or two single family residences in Toronto | ||
| Portion
of Purchase Price |
Current MLTT Rate | MLTT Rate as
of March 1, 2017 |
| Up to and including $55,000 | 0.5% | 0.5% |
| Above $55,000, up to $250,000 |
1.0% | 1.0% |
| Above $250,000, up to $400,000 (new bracket) |
1.0% | 1.5% |
| Above $400,000, up to $2 million |
2.0% | 2.0% |
| Above $2 million (new bracket) |
2.0% | 2.5% |
| All
other property in Toronto (commercial, industrial, multi-unit residential and agricultural land) |
||
| Portion
of Purchase Price |
Current MLTT Rate | MLTT Rate as
of March 1, 2017 |
| Up to and including $55,000 | 0.5% | 0.5% |
| Above $55,000, up to $250,000 |
1.0% | 1.0% |
| Above $250,000, up to $400,000 (new bracket) |
1.0% | 1.5% |
| Above $400,000, up to $40 million (new rate) |
1.5% | 2.0% |
| Above $40 million (new rate) |
1.0% | 2.0% |
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
