First-time buyer rebates on Land Transfer Tax


sale-2I get asked a lot about rebates for first-time buyers. The rules can be a bit complex, which is why it happens fairly regularly that someone thinks they qualify when they don’t. Here are the basic rules:

  1. You have never owned property anywhere in the world. That means never, anywhere. Not “not in the past five years.” Not “I owned a property in another country.” Not even “I went on title to my parents’ condo in Florida.” You can’t ever have been on title to any property, anywhere.
  2. You do not, or did not, have a spouse who has owned property at any point while you were spouses. The key point to remember here is that Ontario’s Family Law Act has two definitions of the term “spouse” – one is that you are legally married, and one that is expanded to include two people who have been living together for at least three years or have a child together. For Land Transfer Tax, the broader definition is used, which means that if you have been living for at least three years with your partner in a house that they own, you are no longer eligible for the rebate. Even if you break up, you lost the right to the rebate during your relationship and cannot get it back.

It’s really important to be aware of the rules, and to be sure that you fit into them, before assuming that you’re going to get the full rebate. If you’re not sure, ask your lawyer at the beginning so that you aren’t budgeting for money you won’t get.