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First-time homebuyers in Ontario may qualify for a land transfer tax refund of up to $4,000, but the rules are very specific. According to the Criteria Under the Ontario Land Transfer Tax Act, eligibility requires that a buyer be at least 18 years old, have never owned a home anywhere in the world, and intend to live in the property within nine months of closing. The application must be submitted within 18 months of the transfer date.
Where many buyers get confused is in joint purchases. If two buyers are purchasing together and only one is a first-time buyer, the refund is pro-rated. For example, if each owns 50% of the home, the eligible buyer can claim 50% of the refund—up to $2,000. If the eligible buyer owns 70%, then they may claim up to $2,800.
Spouses have additional rules. If a spouse owned a home while they were married to the first-time buyer, neither spouse may qualify for the refund. But if the previous ownership occurred before the relationship, the true first-time buyer can still qualify for their proportional share.
For buyers entering today’s market—especially with affordability challenges—this rebate can meaningfully reduce upfront costs. Realtors should make sure clients understand how joint ownership and spousal history affect the final refund amount.
