How may title be taken?
Title can be taken in three distinct ways:
1. Sole owner – when only one person is taking title
2. Joint tenants – when two people take title with 50-50% interest in the home
Right of survivorship: upon the death of one title holder, the other
joint tenant automatically becomes sole owner of the property.
avoids the home falling under the Estate Administration and the applicable Estate Administration Tax, though, there are other tax implications which may need to be considered.
3. Tenants-in-common – when two or more people are taking title
There is no right of survivorship: upon the death of a title holder, such title holder’s interest in the property goes to his/her estate and is dealt with according to
his/her Will or Succession Law Reform Act if there is no Will.
The deceased interest in the property will fall under Estate Administration and the Estate Administration Tax will be payable on the home.
Interest in the property does not have to be distributed equally among the tenants-in-common (one party may hold 99% interest, while the other party may only hold 1% interest).
The decision of who should go on title should be based on many things including, but not limited to, relationship status (married, common-law, single, etc.), financial situation,
tax implications, and estate planning.
First time home buyer
Do I qualify to receive the land transfer tax rebate for first-time homebuyers?
Who qualifies as a first time home buyer?
1. The purchaser is at least 18 years of age;
2. The purchaser must occupy the home as his/her principal residence no later than nine months after the date of the conveyance or disposition;
3. The purchaser cannot have previously owned a home, or had any ownership interest in a home, anywhere in the world, at any time;
4. If the purchaser has a spouse, the spouse* cannot have owned a home, nor had any ownership interest in a home, anywhere in the world while he/she was the purchaser’s spouse;
5. The purchaser cannot have previously received an Ontario Home Ownership Savings Plan (OHOSP)-based refund of land transfer tax.
*Definition of spouse:
Married couple, or non-married couple who have cohabitated 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.
What is the land transfer tax rebate for first time home buyers?
For a property located in Ontario, if the purchaser is a first time home buyer of a newly constructed or resale residential home, a rebate of $2,000.00 is available.
There is additional land transfer tax for properties located in Toronto. For a property located in Toronto, first time home buyers are exempt from paying land transfer tax on the first $400,000.00. If the purchase price is above $400,000.00, the first time home buyer will have receive a rebate of $3,725.00, but will have to pay the land transfer tax on the difference.