First Time Buyers will be getting a few breaks in 2008!
New Info Re: Toronto LTT Rebates Provided By City
December 14, 2007 -- The City of Toronto has indicated that it will allow purchasers who are eligible for a FULL rebate of the Toronto Land Transfer Tax (TLTT) to close their transactions without paying the TLTT upfront (and then receiving a rebate at a later date).
Toronto land transfer tax is not payable on transactions closing before the tax takes effect on February 1, 2008. For transactions closing after the Toronto land transfer tax takes effect on February 1, 2008, the City of Toronto allows for certain rebates, as described below.
According to the City, purchasers who are eligible for a FULL rebate of the Toronto land transfer tax will not have to pay the tax (meaning that they do not have to pay the tax upfront and be rebated later). This includes the following:
Purchasers who have entered into an Agreement of Purchase and Sale for a property on or before December 31, 2007; and
First-time home buyers where the total Toronto land transfer tax is $3,725 or less ($3,725 is the amount of TLTT payable on a home purchased for $400,000). First-time home buyers with Toronto land transfer tax payable above the maximum rebate amount of $3,725 (those purchasing homes above $400,000) will be required to pay the total Toronto land transfer tax, and then receive the maximum rebate of $3,725 at a later date from the City. Once all changes have been made to Teranet’s collection system, in the spring of 2008, these buyers will only have to pay the balance of the Toronto land transfer tax above $3,725.
Complete details of the Toronto land transfer tax are available by calling the City of Toronto at 416-338-0338 or click here
Province Expands Provincial Land Transfer Tax Rebate
December 13, 2007 -- The provincial government has announced it is expanding the PROVINCIAL land transfer tax rebate for first-time buyers to include re-sale housing!
First-time buyers of BOTH re-sale, and newly constructed homes, will be eligible for a rebate of the provincial land transfer tax of up to $2,000.
Effective for first-time buyers who enter into Agreements of Purchase and Sale AFTER December 13, 2007.
This change is being implemented by provincial legislation introduced on December 13, 2007. The Ministry of Finance has indicated that, until the legislation is passed, first-time buyers of re-sale properties eligible for the rebate can submit their applications for the refund and they will be processed once the legislation has passed. It is not known when the legislation will be passed. Buyers can consult with their lawyers if they have concerns.
The provincial land transfer tax rebate applies in all Ontario municipalities ($2,000 max). In Toronto, the provincial rebate is in addition to City rebates of the Toronto Land Transfer Tax.
Further information is available by calling: Ministry of Finance, Land Transfer Tax Section, 905-433-6361 or to obtain forms click here
2008 GST/HST Rate Reductions re: New Housing
December 18, 2007 -- On October 30, 2007, the Government of Canada announced in its Economic Statement that it proposes to reduce the GST rate by one percentage point from 6% to 5%, effective January 1, 2008. To facilitate the transition to the lower rate, the Economic Statement also proposes transitional rules for determining the GST/HST rates applicable to transactions that straddle the January 1, 2008 implementation date. If you have a real estate closing on a newly constructed home effective January 1st, 2008 or thereafter, please speak to your real estate lawyer to check the gst rate, you might just save an additional 1%.
Happy House Hunting to First Time Buyers in the GTA for 2008!