Costs, Taxes & Legal

If the property was your principal residence for every year you owned it, the gain is generally fully exempt from capital gains tax under the principal residence exemption, so you typically pay nothing. If it was a rental, cottage, investment, or second property, you'll usually owe tax on the capital gain. In Canada a portion of the capital gain (historically half for most individuals) is included in your taxable income for the year of sale. Because the rules and inclusion rates can change, confirm the current treatment with a tax professional before selling.

The principal residence exemption (PRE) lets you avoid paying capital gains tax on the increase in value of a home that qualified as your principal residence for the years you owned it. You can generally only designate one property per family unit as a principal residence per year, so you must choose between, say, a house and a cottage for overlapping years. Even when the gain is fully exempt, you're still required to report the sale on your tax return. Special rules apply to changes in use, such as turning a home into a rental, so professional advice is wise.

The Residential Tenancies Act (RTA) is Ontario's main law governing the relationship between residential landlords and tenants. It sets the rules for rent increases, deposits, maintenance, entry, evictions, and the role of the Landlord and Tenant Board, and most of its protections cannot be waived even if a lease says otherwise. It covers most residential rentals but excludes certain situations, such as living in the same unit as your landlord and sharing a kitchen or bathroom. Both landlords and tenants benefit from knowing their RTA rights and obligations before disputes arise.

Yes. In Ontario, a licensed lawyer is required to close a residential real-estate transaction because they handle title transfer, register documents, and exchange funds. A real-estate lawyer reviews your agreement of purchase and sale, conducts title searches, arranges title insurance, reviews the status certificate for condos, calculates closing adjustments, and ensures the deal closes legally. It's best to involve them early, ideally before your offer becomes firm. Their fee is a standard and worthwhile part of your closing costs.

Rental income in Canada is taxable and must be reported on your tax return for the year you earn it. Against that income you can generally deduct reasonable expenses such as mortgage interest (not principal), property taxes, insurance, condo fees, repairs and maintenance, property management, and advertising for tenants. Capital improvements are treated differently from current repairs and are usually deducted over time through capital cost allowance. Keeping organized records is essential, and Summitly's Rental Intelligence can help landlords track market rents and the numbers behind their investment.

The Non-Resident Speculation Tax (NRST), often called the foreign buyer tax, applies when a foreign national, foreign corporation, or taxable trustee buys residential property in Ontario. As of 2026 the rate is 25% of the purchase price and it applies province-wide, on top of regular land transfer taxes. Certain rebates or exemptions may apply, for example to some nominees or those who later become permanent residents within a set period. Anyone who isn't a Canadian citizen or permanent resident should get legal and tax advice before buying.

Ontario's provincial land transfer tax is tiered: roughly 0.5% on the first $55,000, 1.0% up to $250,000, 1.5% up to $400,000, 2.0% up to $2 million, and 2.5% on amounts above $2 million. For example, on a $700,000 home the provincial LTT is typically around $10,475 before any rebate. Summitly's land transfer tax calculator computes the exact amount for your price, and Zara can confirm whether a rebate applies. This is general information, not tax or legal advice.

Buyers within the City of Toronto pay a municipal land transfer tax on top of the provincial one, using similar tiered rates that roughly double the total LTT bill. As of 2026, Toronto also applies higher surtax rates on luxury homes above $3 million. On a $700,000 Toronto home the combined provincial and municipal LTT is typically around $20,950 before rebates. Use Summitly's Toronto-aware LTT calculator and ask Zara about the first-time buyer rebates available on both taxes. This is general information, not tax or legal advice.

Eligible first-time buyers in Ontario can receive a provincial land transfer tax rebate of up to $4,000, and those buying in Toronto can also claim a municipal rebate of up to $4,475. Combined, a qualifying Toronto first-time buyer can save up to $8,475 in land transfer tax. Summitly's calculator factors these rebates into your closing costs, and Zara can help you check eligibility. This is general information, not tax or legal advice.

Real estate legal fees in Ontario typically run about $1,500-$2,500 for a purchase or sale, including the lawyer's fee plus disbursements like title searches, registration, and software charges. Purchases usually cost a bit more than sales because of title transfer and mortgage registration work. Summitly's closing cost calculator includes a legal-fee estimate, and Zara can help you understand what's covered. This is general information, not legal advice.

Property tax in Ontario is based on your municipality's tax rate multiplied by your home's MPAC assessed value, with effective rates typically ranging from about 0.6% to 1.5% per year depending on the city. Toronto's rate is among the lowest in the province, while many smaller municipalities are higher. Summitly's listings show estimated property taxes, and Zara can help you compare ongoing costs between areas. This is general information, not tax advice.

Ontario property tax is calculated by multiplying your property's MPAC assessed value by the combined municipal and education tax rates set each year. So a home assessed at $600,000 in a municipality with a 1.0% effective rate would owe roughly $6,000 annually. Note that MPAC assessed values can differ from current market value; Summitly's valuation tools and Zara can help you understand the gap. This is general information, not tax advice.

Title insurance in Ontario is usually a one-time premium of about $250-$500 for a typical home, scaling up with the property's value. It protects against title fraud, survey issues, and certain unknown defects for as long as you own the home. Title insurance is normally arranged by your lawyer at closing and included in Summitly's closing cost estimates; Zara can explain what it covers. This is general information, not legal advice.

Selling your principal residence is generally exempt from capital gains tax in Ontario, but selling an investment or secondary property typically triggers tax on a portion of the gain. The taxable amount depends on your cost base, improvements, and current inclusion rules. Because this is complex and changes over time, confirm with an accountant; Summitly and Zara can help you estimate sale price but this is general information, not tax advice.

Holding a rental personally is simpler and cheaper to set up, with income taxed at your personal rate, while a corporation offers liability separation, potential tax planning, and easier multi-investor structuring but adds accounting costs and complexity. Personal ownership suits small investors with one or two properties; a corporation can suit larger portfolios or those seeking liability protection and estate planning. Mortgage terms and rates also differ between the two. This decision is highly individual, so consult an accountant and lawyer; this is general information, not tax or legal advice.

Under Ontario's Family Law Act, the matrimonial home is the home where spouses ordinarily lived together, and both married spouses have an equal right to possession regardless of whose name is on title. This means one spouse generally cannot sell, mortgage, or remove the other from the matrimonial home without consent or a court order. The rules differ for common-law partners, so it's important to confirm your situation with a family lawyer. Summitly's Zara can help you understand the home-sale side, but you should rely on a lawyer for your legal rights.

The estate trustee (executor) usually needs the authority to sell, which often means obtaining a Certificate of Appointment of Estate Trustee (commonly called probate) before title can transfer to a buyer. You'll typically need to settle estate debts, confirm all beneficiaries are informed, and work with an estate lawyer to keep the sale clean. Estate Administration Tax and potential capital gains on the property may apply, so professional tax and legal advice is essential. Summitly's Zara can help you prepare and market the property while your lawyer handles the estate side.

You can often list and even accept an offer before probate is finalized, but most buyers' lawyers will want the sale to close only once the estate trustee has clear authority to convey title, which usually means after the Certificate of Appointment is issued. Probate timelines can vary widely, so it's smart to build flexible closing dates into the agreement. Always coordinate with an estate lawyer to avoid title problems. Summitly's Zara can help time the marketing so you're ready to move the moment your authority is confirmed.

There is no inheritance tax in Ontario, but the estate may owe Estate Administration Tax, and capital gains can apply on the increase in value from the date you inherited (or the date of death) to the date of sale if it wasn't your principal residence. If the home was the deceased's principal residence, a gain up to the date of death may be exempt. These rules are nuanced, so consult an accountant or tax advisor before selling. Summitly's Zara can provide a current market estimate to support that tax planning, but this isn't tax advice.

In a power of sale, the lender sells the property to recover what's owed and must return any surplus to the borrower, and it's the most common remedy used in Ontario. In a foreclosure, the lender takes ownership of the property outright and keeps any excess value, which is slower and rarer here. Both are serious legal processes with strict timelines and notice requirements, so a borrower in default should get legal advice immediately. Summitly's Zara can help you understand options like selling before a lender forces the issue, but this isn't legal advice.

Joint tenancy means equal ownership with a right of survivorship, so if one owner dies their share automatically passes to the others, which suits many couples. Tenancy in common lets owners hold unequal shares and pass their portion to their own heirs, which often suits friends or family investing together. The right structure affects taxes, estate planning, and what happens in a dispute. Summitly's Zara can help you shop as a team, but choose your ownership structure with a real estate lawyer.

How you hold title affects land transfer tax (including first-time buyer rebates), capital gains, probate, and who controls the property, so the decision deserves professional advice. Putting an aging parent on title alone may simplify their principal-residence exemption, while joint ownership can affect your own future first-time buyer status and tax exposure. There's no one-size-fits-all answer. Summitly's Zara can handle the property search and comparisons, but a lawyer and accountant should guide the ownership structure.

Ontario charges a provincial land transfer tax on a sliding scale based on purchase price, and buyers in the City of Toronto pay an additional municipal land transfer tax of a similar amount, effectively doubling the cost there. First-time buyers may qualify for rebates that offset part of the tax, up to set maximums for the provincial and Toronto portions. These taxes are due on closing and should be budgeted alongside legal fees. Summitly's Zara can help you estimate closing costs including land transfer tax; this is general information, not legal or tax advice.

Interest on the mortgage for your principal residence is generally not tax-deductible in Canada, unlike in some other countries. However, interest can be deductible when the borrowed money is used to earn income, such as on a rental property or certain investments, and some homeowners use strategies like the Smith Manoeuvre to convert mortgage interest into deductible interest. These strategies are complex and carry risks, so professional guidance is essential. Summitly's Zara can connect you with qualified tax professionals; this is general information and not tax or legal advice.

When you sell an investment property that isn't your principal residence, the profit is generally a capital gain, of which a portion (the inclusion rate) is added to your taxable income and taxed at your marginal rate. The inclusion rate has historically been 50%, though proposed changes have created uncertainty, so confirm the current rules. If the CRA deems your activity a business (such as frequent flipping), profits can instead be fully taxable as business income. Consult a tax professional; this is general information, not tax or financial advice.

The principal residence exemption can eliminate capital gains tax on a property that qualified as your principal residence for the years you owned it, but you can designate only one property as your principal residence per year for a family unit. Pure investment or rental properties generally don't qualify for the years they weren't your principal residence. Converting a home to a rental (or vice versa) triggers special change-in-use rules. A tax professional should confirm eligibility; this is general information, not tax advice.

Canada's residential property flipping rule generally treats profit from selling a residential property owned for less than 365 days as fully taxable business income, removing access to the capital gains treatment and principal residence exemption, unless a life-event exception applies (such as death, divorce, or job relocation). This targets quick flips and can significantly raise the tax bill versus a longer hold. Plan holding periods with this in mind and get professional tax advice; this is general information, not tax advice.

Net rental income (rent minus eligible expenses) is added to your taxable income and taxed at your marginal rate. Common deductible expenses include mortgage interest (not principal), property tax, insurance, repairs and maintenance, property management, utilities you pay, and certain professional fees, while major improvements are usually capitalized rather than expensed. Capital cost allowance (depreciation) is optional but can affect future capital gains. Keep thorough records and consult a tax professional; this is general information, not tax advice.

The FHSA is a registered account for first-time buyers that combines features of an RRSP and TFSA: contributions are generally tax-deductible, and qualifying withdrawals to buy a first home are tax-free. There are annual and lifetime contribution limits set by the federal government — confirm the current amounts and eligibility rules with the CRA before you rely on them.

Yes — eligible first-time buyers can combine an FHSA qualifying withdrawal with the RRSP Home Buyers' Plan for the same purchase, which can meaningfully boost a down payment. Each program has its own rules and limits, so plan the sequence with a financial advisor and verify current limits with the CRA. Use Summitly's down-payment calculator to model the combined total.

The Home Buyers' Plan lets eligible first-time buyers withdraw from their RRSP, tax-free, to buy or build a qualifying home, then repay it to the RRSP over a set number of years (around 15). There is a maximum withdrawal amount that has changed in recent years, so confirm the current limit and repayment rules with the CRA before counting on it.

Under the HBP you repay your RRSP withdrawal in annual instalments over roughly 15 years, starting a couple of years after the withdrawal. If you don't make a required repayment for a year, that portion is added to your taxable income for the year instead. Track your repayment schedule and confirm the current rules with the CRA.

Yes. Ontario offers a land transfer tax (LTT) refund for eligible first-time buyers, up to a maximum amount, which can reduce or eliminate the provincial LTT on a qualifying purchase. The maximum and eligibility conditions are set by the province — verify the current figures on Ontario.ca, and estimate your costs with Summitly's calculators.

Yes. Buyers in the City of Toronto pay both the provincial LTT and an additional Municipal Land Transfer Tax (MLTT), and first-time buyers can claim a rebate on the MLTT as well, up to a set maximum. That means two separate rebates may apply in Toronto. Confirm current maximums and eligibility with the City of Toronto and Ontario.ca.

New and substantially renovated homes in Ontario include GST/HST, and buyers may qualify for the federal GST/HST New Housing Rebate and an Ontario portion, which recover part of the tax. The rebate amount depends on the price and whether you'll live in the home versus rent it (a separate rebate applies to rentals). The rules are detailed — confirm current thresholds with the CRA or your lawyer.

As a rough planning figure, buyers often budget around 1.5%–4% of the purchase price for closing costs, though the actual total depends heavily on land transfer tax (higher in Toronto, lower or rebated for first-time buyers) and your specific situation. Major items are LTT, legal fees, title insurance, inspection and adjustments. Use Summitly's calculators to estimate your real number for a given price.

Legal fees for a typical residential purchase usually land in the four figures once disbursements (title search, registration, software, courier) and HST are included, with the lawyer's professional fee and disbursements often itemized separately. Costs rise for more complex deals like new builds or assignments. Always ask for an all-in quote up front so there are no surprises at closing.

Ontario land transfer tax is calculated on a sliding scale of the purchase price, with higher rates on higher price brackets. Buyers in the City of Toronto pay an additional Municipal Land Transfer Tax on top, roughly doubling the bill. First-time buyers may claim rebates against both. Because the brackets and rebates are set by government, estimate yours with Summitly's calculators and confirm on Ontario.ca.

Title insurance is typically a one-time premium paid at closing, commonly a few hundred dollars for an owner policy on an average home, scaling with the property's value. It's arranged through your lawyer. Lenders usually require a lender policy; the owner policy is optional but widely recommended for the long-term protection it provides against title fraud and defects.

In Ontario the fee a condo corporation can charge for a status certificate is capped by regulation (commonly around the low hundreds of dollars, including HST), and it must be provided within a set number of days of the request. Your lawyer reviews it as part of a condo purchase. Rush requests may not be accommodated, so order it early when your offer is conditional on the review.

Your annual property tax is your property's assessed value (from MPAC) multiplied by your municipality's tax rate, which the city sets each year to fund local services. Rates and assessed values differ by municipality, so two similarly priced homes in different cities can have very different tax bills. Estimate yours with Summitly's property-tax calculator and verify the current rate with your municipality.

Resale (previously occupied) homes in Ontario are generally exempt from HST on the purchase price. New and substantially renovated homes include HST, though buyers may recover part of it through the GST/HST New Housing Rebate. Builder prices are sometimes quoted net of the rebate assuming you'll live there — confirm exactly what's included and your rebate eligibility with your lawyer.