Do I Qualify?
- You are purchasing a home in Ontario, BC, or PEI (or the City of Toronto for the municipal rebate)
- You have never owned a home anywhere in the world before
- If you have a spouse or common-law partner, they have also never owned a home anywhere in the world (for most provincial rebates)
- The property will be your principal residence
- You are a Canadian citizen or permanent resident (Ontario requirement)
- You are 18 years of age or older
What Is It?
When you buy a home in Canada, several provinces charge a land transfer tax (LTT) based on the purchase price. Ontario, British Columbia, and Prince Edward Island all charge LTT — and all three offer rebates for first-time homebuyers that can save you thousands at closing. The rebate is applied automatically through your lawyer at the time of closing; you don’t file for it afterward.
Several provinces — including Alberta, Saskatchewan, Nova Scotia, New Brunswick, and Newfoundland — charge no land transfer tax at all, so no rebate is needed.
How It Works
Ontario
Ontario charges LTT on a sliding scale from 0.5% to 2.5% on purchase prices over $2 million. First-time buyers can claim a rebate of up to $4,000.
- Full rebate applies to homes up to approximately $368,000 (where the LTT equals exactly $4,000)
- Partial rebate applies above that threshold — you pay LTT only on the portion above the rebate ceiling
- Both spouses must be first-time buyers; if one spouse has previously owned a home anywhere in the world, the rebate is reduced by 50%
City of Toronto add-on: Toronto levies a second, identical municipal LTT on top of the provincial tax. First-time buyers in Toronto get a matching municipal rebate of up to $4,475 (the maximum municipal LTT on a home up to ~$400,000). Combined, Toronto first-time buyers can save up to $8,475.
British Columbia
BC charges the Property Transfer Tax (PTT) at 1% on the first $200,000, 2% on amounts from $200,001 to $2 million, and higher rates above that. The First Time Home Buyers’ Program exempts eligible buyers from the full PTT on homes up to $500,000 — a saving of up to $8,000. Partial exemptions apply for homes priced $500,001–$525,000. Above $525,000, no exemption is available.
The BC exemption requires that you have never owned a home anywhere in the world and that you move into the home within 92 days of registration and live there for at least one year.
Prince Edward Island
PEI charges a land transfer tax of 1% of the greater of the purchase price or assessed value. First-time buyers are fully exempt on the purchase of a home if the property value is $200,000 or less. Above that, you pay LTT on the full amount with no partial exemption.
What Most People Don’t Know
- “Never owned a home anywhere in the world” is strict. Owning even a tiny share of a property in another country can disqualify you. This includes inherited property, a foreign vacation home, or a co-ownership stake.
- The rebate is applied at closing — not on your tax return. Your real estate lawyer handles this. You must advise your lawyer before closing, not after.
- Newly built homes and assignments. In Ontario, the rebate applies to newly built homes as well as resales. However, the calculation can be more complex for assignments and pre-construction purchases — confirm with your lawyer.
- If you miss it, you can still claim it. Ontario allows you to apply for the rebate within 18 months of the transfer if it wasn’t applied at closing. BC also allows a refund application after closing.
- Common-law partners are treated as spouses. In Ontario, if you are in a common-law relationship, your partner’s prior home ownership counts against your eligibility just as a married spouse’s would.
Frequently Asked Questions
My spouse previously owned a home abroad. Can I still get the Ontario rebate?
You will get a 50% rebate, not the full amount. In Ontario, if one spouse has owned a home anywhere in the world before, the rebate is reduced by 50%. If both spouses have previously owned a home, no rebate is available.
Does the Toronto municipal rebate stack on top of the Ontario provincial rebate?
Yes. If you are buying in the City of Toronto (not just the GTA — the municipality of Toronto specifically), you pay both the Ontario provincial LTT and the Toronto municipal LTT. First-time buyers can claim a rebate on both, for a combined maximum saving of $8,475.
Do I qualify in BC if I’ve lived there less than a year?
BC requires that you are a Canadian citizen or permanent resident, but there is no minimum residency period in BC before purchase. You do, however, need to occupy the property as your principal residence within 92 days of registration and live there for at least 12 consecutive months after.
What is the PEI exemption limit and is it adjusted for inflation?
The PEI exemption currently applies to homes valued at $200,000 or less. This threshold has been relatively static. Given PEI’s rising real estate prices, many first-time buyers now exceed this limit and receive no benefit. Check PEI’s current rules at the time of purchase with your lawyer.
If I buy a home with a friend (not a spouse), do we each get a partial rebate in Ontario?
Yes. In Ontario, if two unrelated first-time buyers purchase together, each eligible buyer’s share of the rebate is applied proportionally. If one co-purchaser has previously owned a home, only the first-time buyer’s proportionate share of the rebate is allowed.