Land Transfer Taxes and Foreign Buyer Rules Across Canada
- Ahsan Chaudhry
- Aug 7
- 4 min read
Why Your Closing Costs Might Be More Than Your Mortgage Broker Admits
Buying property in Canada? Congratulations — and prepare for some fine-print fun. Between land transfer taxes, non-resident surcharges, and a labyrinth of provincial policies, your closing costs could balloon faster than your excitement.
Whether you're a first-time buyer, seasoned investor, or newly arrived non-resident, understanding Canada's provincial and federal real estate taxes could save you thousands. Let's break it all down, province by province, tax by tax.
Land Transfer Tax Basics: What Every Buyer (and Their Wallet) Should Know
A land transfer tax (LTT) is a provincial fee you pay when purchasing real estate. Alberta and Saskatchewan don’t charge one — which might be why their license plates are smiling. The rest of Canada? They’ll gladly take a cut.
This tax is typically based on the purchase price and varies by province. In hot markets like Ontario, British Columbia, and Nova Scotia, things get more complex (and expensive) when foreign buyer rules come into play.
Ontario Land Transfer Tax: Tiered, Stacked, and Full of Surprises
Here’s how Ontario’s LTT works for residential properties:
0.5% on the first $55,000
1.0% on amounts from $55,001 to $250,000
1.5% on amounts from $250,001 to $400,000
2.0% on amounts from $400,001 to $2,000,000
2.5% on amounts over $2,000,000 (single-family homes)
If you're buying in Toronto, get ready to pay the Municipal Land Transfer Tax (MLTT) — which mirrors the provincial tax. Yes, it’s basically the tax version of déjà vu.
Ontario's 25% Non-Resident Speculation Tax (NRST)
Since October 2022, non-Canadian citizens, non-permanent residents, and foreign corporations purchasing residential property anywhere in Ontario must pay an additional 25% NRST.
There are rebates available — for example, if you become a permanent resident within four years of your purchase, you might be eligible to recover the NRST. But you’ll need a lawyer who reads the fine print even when it’s in bold.
Coming January 2025: Toronto’s 10% Municipal NRST
To make things even more exciting, Toronto is introducing a 10% Municipal Non-Resident Speculation Tax (MNRST) on foreign buyers starting January 1, 2025.
This is on top of the 25% provincial NRST. So if you’re a non-resident buying in Toronto, your total foreign buyer surcharge jumps to 35%, plus the regular LTT and MLTT. Suddenly, that condo doesn’t feel so “affordable,” does it?
British Columbia: High Prices, High Taxes
British Columbia’s Property Transfer Tax (PTT) works like this:
1% on the first $200,000
2% on the portion between $200,001 and $2,000,000
3% on the portion between $2,000,001 and $3,000,000
5% on any amount over $3,000,000
Yes, that’s 5% on the luxury tier — because why not make buying a mansion even more painful?
B.C.’s 20% Foreign Buyer Tax
Foreign buyers purchasing in B.C.’s designated areas — such as Metro Vancouver, Fraser Valley, Capital Regional District, Kelowna, and Nanaimo — must also pay a 20% Additional Property Transfer Tax (APTT).
This surcharge applies to:
Foreign nationals
Foreign corporations
Taxable trustees
Some exemptions exist for international students, workers, and provincial nominees, but the criteria are strict and need legal navigation.
Nova Scotia: The Quiet Province with a Loud Tax
Nova Scotia implemented a Non-Resident Deed Transfer Tax of 5% in 2022, and recently increased it to 10% effective April 1, 2025.
This tax applies to:
Non-Canadian citizens
Non-permanent residents
Residential properties with three or fewer units
If the buyer becomes a resident within six months, they may be exempt. But for non-residents eyeing a coastal cottage — be ready to pay.
The Federal Foreign Buyer Ban: No Entry (Until 2027)
Canada’s federal government banned most foreign nationals from purchasing residential property starting in
January 2023. Initially set to expire in 2025, the ban has been extended to January 1, 2027.
Who is exempt?
Canadian citizens and permanent residents
Refugees and protected persons
Work permit holders meeting residency conditions
Purchasers with a Canadian spouse or common-law partner
The ban does not apply to commercial properties or vacant land, and some rural and recreational properties are exempt — but only in designated areas.
How to Legally Outsmart These Taxes (Yes, It's Possible)
Thankfully, it’s not all doom, gloom, and deduction. Here are some legitimate ways to reduce or avoid taxes:
Ontario
First-Time Home Buyer Rebate: Up to $4,000 off LTT
NRST Rebate: Available if you become a permanent resident within 4 years
Family Transfers: Certain spousal or parent-to-child transfers may be exempt
British Columbia
First-Time Buyer Exemption: Available on homes under $500,000 (partial up to $525,000)
New Home Exemption: Full PTT exemption on newly built homes under $750,000
Provincial Nominee Exemption: Some foreign buyers may qualify
Nova Scotia
Non-Resident Residency Rule: If you become a resident within 6 months of purchase, you may avoid the 10% deed tax
These rebates are not automatic. You’ll need to apply — and it helps to have a lawyer who knows their way around a government form.
Don’t Be That Buyer Who Skips the Legal Advice
With so many layers of taxation and regulation, buying property in Canada can feel like a pop quiz on bureaucracy. But with the right advice and up-to-date legal insight, you can avoid costly surprises.
From Toronto’s triple-tax tango to Nova Scotia’s residency roulette, the rules are changing fast — and the consequences for getting them wrong are expensive.
Brace Law Can Help You Navigate the Canadian Real Estate Law
At Brace Law, we help buyers (local and international) navigate complex real estate law across Ontario, especially in Oakville, Vaughan, and the Greater Toronto Area.
Whether you're dealing with land transfer tax, foreign buyer restrictions, or a confusing municipal bylaw, we provide the clarity and legal protection you need to close with confidence.
Buying property? Don’t just wing it. Get experienced legal support. Reach out to our top-rated real estate lawyers at Brace Law today for a consultation before you buy.
📍 Our Oakville Law Office (Main Office): 2939 Portland Dr Unit 202, Oakville, ON L6H 5S4
📍 Our Vaughan Law Office: 3883 Highway 7 Road, Unit 220, Vaughan, ON L4L 6B9
📧 Email: staff@bracelaw.ca
Visit www.bracelaw.ca or call us today to book your consultation.
Disclaimer: The information provided in this blog is for general informational purposes only and does not constitute legal advice. Legal policies and regulations change frequently, and every case is unique. For personalized legal guidance tailored to your situation, please consult with a qualified lawyer.