How much are closing costs in Ontario?

A common planning range is about 1.5% to 4% of the purchase price, on top of your down payment. Land transfer tax is usually the largest piece, then legal fees and disbursements, inspection, adjustments, and the sales tax on any mortgage default insurance premium.

How much is land transfer tax on a $500,000 home in Ontario?

About $6,475 in provincial land transfer tax. An eligible first-time buyer can get up to $4,000 refunded, leaving about $2,475. Your lawyer calculates the exact amount.

Can closing costs be added to my mortgage?

Generally no. Closing costs are paid from your own funds. The mortgage default insurance premium can be added to the mortgage, but the 8% Ontario sales tax on that premium is paid at closing.

Do I pay Toronto land transfer tax if I buy in Ottawa or Lanark County?

No. The municipal land transfer tax applies only in the City of Toronto. Elsewhere in Ontario you pay the provincial tax only.

Ontario Closing Costs for First-Time Buyers

Q: Who qualifies for the Ontario first-time buyer land transfer tax refund?

Generally, you must be at least 18, a Canadian citizen or permanent resident, occupy the home as your principal residence within nine months, and neither you nor your spouse (while your spouse) can have owned a home anywhere in the world.

The short answer

On top of your down payment, plan for closing costs. In Ontario the biggest one is usually land transfer tax, followed by legal fees, inspection, adjustments and insurance. A common planning range is about 1.5% to 4% of the purchase price, and many lenders want to see that you have funds set aside for closing costs before they approve you. First-time buyers can get up to $4,000 of Ontario land transfer tax refunded.

1. Ontario land transfer tax

Ontario charges land transfer tax when you buy property. For a home with one or two single family residences, it is calculated in brackets:

Portion of the purchase price	Rate
Up to $55,000	0.5%
$55,000 to $250,000	1.0%
$250,000 to $400,000	1.5%
$400,000 to $2,000,000	2.0%
Over $2,000,000 (one or two single family residences)	2.5%

First-time buyer refund

Eligible first-time buyers can get a refund of up to $4,000, which covers the full tax on homes up to $368,000. You generally must be at least 18, a Canadian citizen or permanent resident, live in the home as your principal residence within nine months, and neither you nor your spouse (while your spouse) can have owned a home anywhere in the world. The refund is usually claimed by your lawyer when the transfer is registered, and otherwise must be claimed within 18 months.

Worked examples

Purchase price	Ontario land transfer tax	Eligible first-time buyer pays
$400,000	$4,475	$475
$500,000	$6,475	$2,475
$650,000	$9,475	$5,475

Example: $500,000 is $275 (0.5% of $55,000) plus $1,950 (1% of $195,000) plus $2,250 (1.5% of $150,000) plus $2,000 (2% of $100,000) = $6,475. Estimates only. Your lawyer calculates the final amount.

Buying in the City of Toronto adds a separate municipal land transfer tax with its own first-time buyer rebate. That does not apply in Carleton Place, Ottawa or the rest of the Ottawa Valley.

2. Legal fees and disbursements

A real estate lawyer handles the title search, registers the transfer and mortgage, and pays out the funds. Expect a legal fee plus disbursements such as registration fees, searches and title insurance. Ask for a written quote that lists both. Fees vary by lawyer and by how complex the purchase is.

3. Home inspection, water and septic

A home inspection is optional but strongly recommended. In rural Lanark and Renfrew counties, add a water potability test for a private well, and consider a septic inspection. Your lender or lawyer may require the water test.

4. Appraisal

The lender may need an appraisal to confirm the value. Sometimes the lender covers it, sometimes you do. I tell you which applies before it is ordered.

5. Adjustments on closing

If the seller has prepaid property tax, utilities or condo fees past your closing date, you reimburse them. In rural homes, a full tank of heating oil or propane is often an adjustment too. These appear on your lawyer's statement of adjustments a few days before closing.

6. Mortgage default insurance and the sales tax on it

With less than 20% down, your mortgage needs default insurance. The premium is usually added to the mortgage. In Ontario, provincial sales tax of 8% applies to the premium, and it cannot be added to the mortgage. It is paid at closing, usually through your lawyer.

7. Home insurance and moving

Your lender needs proof of home insurance before funding. Get a quote early, especially for older homes or riverfront property. Then budget for movers, utility hookups and any immediate repairs.

Buying a newly built home?

New homes include HST in the price, and some extra costs can be charged on closing, such as utility connections or development charges, depending on your agreement. Two rebates may help first-time buyers of new homes: the federal first-time home buyers' GST/HST rebate (up to $50,000 of the federal part of the HST on homes valued up to $1 million, reduced between $1 million and $1.5 million) and the Ontario first-time home buyers' rebate (up to $80,000 of the provincial part of the HST, following the federal eligibility rules). Dates and conditions apply, so have your lawyer confirm eligibility.

Paying for it

A First Home Savings Account (FHSA) and the RRSP Home Buyers' Plan can both help fund a first purchase. Gifts from family are common too, usually with a signed gift letter. Lenders want to see where your down payment and closing funds come from, so keep statements handy.

Sources

Rules checked against the sources above on October 26, 2026. Government rules change, so confirm the current version before you rely on a number.

Ontario closing costs, line by line.