What makes Toronto different
Toronto is unique among Canadian cities for stacking two layers of land transfer tax — the provincial LTT that applies across Ontario, and the additional Municipal Land Transfer Tax (MLTT) that only applies within the City of Toronto's boundaries. On most purchases this effectively doubles the LTT bill.
Add Ontario's 8% PST on the CMHC premium (for insured buyers), and Toronto sits at the top of Canada's most-expensive-to-close list. A $850,000 purchase carries roughly $32,000 in closing costs — meaningful budget on top of the down payment.
Provincial LTT brackets (Ontario)
Ontario LTT is graduated:
| Bracket | Rate | |---|---| | First $55,000 | 0.5% | | $55,001 to $250,000 | 1.0% | | $250,001 to $400,000 | 1.5% | | $400,001 to $2,000,000 | 2.0% | | Above $2,000,000 (residential) | 2.5% |
On an $850,000 purchase, provincial LTT = $13,475 (before any rebate).
Toronto Municipal LTT brackets
Toronto MLTT mirrors the provincial brackets up to $3M, then stacks luxury surtaxes:
| Bracket | Rate | |---|---| | First $55,000 | 0.5% | | $55,001 to $250,000 | 1.0% | | $250,001 to $400,000 | 1.5% | | $400,001 to $2,000,000 | 2.0% | | $2,000,001 to $3,000,000 | 2.5% | | $3,000,001 to $4,000,000 | 3.5% | | $4,000,001 to $5,000,000 | 4.5% | | $5,000,001 to $10,000,000 | 5.5% | | $10,000,001 to $20,000,000 | 6.5% | | Above $20,000,000 | 7.5% |
On an $850,000 Toronto purchase, MLTT = $13,475 (matching provincial).
Total LTT (provincial + MLTT) on the $850,000 purchase: $26,950. Before any first-time-buyer rebates.
First-time buyer rebates
Toronto first-time buyers can stack:
- Up to $4,000 provincial LTT rebate — fully offsets LTT on purchases up to ~$368,000
- Up to $4,475 Toronto MLTT rebate — fully offsets MLTT on purchases up to ~$400,000
- Combined max: $8,475 cash savings at closing
Eligibility:
- 18+ years old
- Canadian citizen or permanent resident
- Have never owned a home or interest in a home anywhere in the world
- Spouse must also never have owned a home (the spousal rule trips many up)
- Plan to occupy as primary residence within 9 months
See our Ontario first-time buyer rebate guide for full eligibility nuances.
CMHC premium + PST (insured buyers)
If you're putting less than 20% down, the CMHC premium is added to your mortgage. But Ontario charges 8% PST on the premium itself — payable IN CASH at closing.
On an $850,000 purchase with 10% down ($85k):
- Mortgage before premium: $765,000
- LTV: 90%
- CMHC premium (2.80%): $21,420 (added to mortgage)
- Ontario PST on premium (8%): $1,714 — paid in cash at closing
Total closing costs worked example
$850,000 purchase, first-time buyer, 10% down, insured mortgage, Toronto:
| Item | Cost | |---|---| | Provincial LTT (after $4,000 rebate) | $9,475 | | Toronto MLTT (after $4,475 rebate) | $9,000 | | Legal fees + disbursements | $2,000 | | Title insurance | $300 | | Property tax adjustment (estimate) | $1,200 | | PST on CMHC premium | $1,714 | | Home inspection | $600 | | Moving costs | $1,500 | | Total closing costs | $25,789 |
That's 3.03% of purchase price. WITHOUT the first-time-buyer rebates the same buyer would pay $34,264 (4.03%).
Newer Toronto-specific taxes to watch for
Vacant Home Tax
Toronto charges 3% of CVA annually on residential properties left unoccupied (with declared exemptions). Owner-occupied + tenanted homes are exempt with annual declaration.
Empty Home Tax declaration required every year
Even owner-occupied Toronto homes must file an annual declaration confirming occupancy. Missing the declaration treats the property as vacant until proven otherwise.
Speculation taxes (proposed)
Toronto City Council has periodically discussed a speculative purchase tax targeting flippers. Currently not implemented as of mid-2026 but worth monitoring if you're a fast-flip investor.
Toronto-specific mortgage qualifying considerations
Condo fees
Toronto condo fees average $0.70-$1.20 per square foot per month. A 700 sq ft condo at $0.85/sq ft = ~$595/mo. Half of condo fees count toward GDS — meaning a $595/mo condo fee adds ~$298 to your shelter cost for qualifying.
Higher rental qualifying credits
Some lenders give 80% rental income credit on Toronto rentals (vs 50% elsewhere) because vacancy is so low. Helps qualify if you have rental properties or plan to rent a basement suite.
Mortgage rate competition
Toronto mortgage rates aren't materially different from the rest of Ontario, but the SHEER VOLUME of brokers and lenders means more rate competition. Same purchase will often get a 5-10 bps better rate via a Toronto-active broker than a regional broker.
Programs and credits beyond LTT rebates
Federal First-Time Home Buyers Tax Credit
$1,500 non-refundable tax credit on your following year's return. Applies anywhere in Canada including Toronto.
Ontario Home Ownership Savings Plan
Not active in 2026 but worth confirming with your accountant in case it's renewed.
HBP + FHSA stacking
First-time buyers can pull up to $40k from FHSA + $60k from RRSP HBP = $100k tax-advantaged down payment. See our FHSA guide and RRSP HBP guide.
New build HST rebate
If buying a new construction condo in Toronto, the new-home HST rebate gives back $24,000+ on the Ontario portion (no phase-out). See our new home HST rebate calculator.
Lender comparison for Toronto buyers
Most major Canadian banks have strong Toronto presence:
- TD, RBC, Scotia, BMO, CIBC — full big-5 presence, branch access, competitive rates
- First National, MCAP, Merix — broker-channel monolines often 25-50 bps cheaper than big 5 on insured mortgages
- Desjardins, National Bank — bilingual service for Toronto's francophone buyers
- HSBC Canada — strong for newcomer / international-income buyers (per the newcomer guide)
Compare quotes via a broker who has access to multiple lenders. Run scenarios in our lender-specific calculators: TD, RBC, Scotia, BMO, CIBC.
Common questions
Why is Toronto LTT so much higher than other cities?
Toronto City Council voted in 2008 to add municipal LTT on top of provincial — making Toronto the only major Canadian city with two LTT layers. The original justification was funding city services without raising property tax. Critics argue it's a wealth transfer from home buyers to all city services.
Can I avoid the MLTT by buying just outside Toronto?
Yes — purchasing in Mississauga, Brampton, Vaughan, Markham, or Richmond Hill (all major suburbs) pays only provincial LTT, no municipal layer. The total LTT bill on a $850k suburban purchase is roughly $13,475 (vs $26,950 in Toronto proper).
Does MLTT apply to commercial purchases?
Yes, with the same brackets as residential plus a luxury surtax tier above $20M.
What if I buy in Toronto and the seller is a foreign buyer?
You don't inherit any foreign buyer taxes — those are paid at the buyer's purchase date. Your closing costs are based on YOUR buyer status only.
Bottom line
Toronto closing costs are the highest in Canada outside ultra-luxury BC purchases. Budget 3.5-4.5% of purchase price on top of your down payment. First-time buyer rebates save up to $8,475 but the math still doesn't trivialize the bill.
Run your exact Toronto closing costs in our Ontario LTT calculator (toggle Toronto = yes), and your full mortgage scenario in the mortgage payment calculator. For full Ontario context, see our Ontario mortgage guide. For other major Canadian cities, see our BC mortgage guide, Alberta mortgage guide, Quebec mortgage guide.