Every municipality must collect duties on the transfer of any immovable situated within its territory. These land transfer duties are better known as the “Welcome Tax”. This tax is payable by the buyer and is calculated as follows:
- 0.5% of the first $50,000;
- 1% of the next $50,000 to $250,000;
- 1.5% of the next $250,000 to $500,000.
- 2% of any portion exceeding $500,000
For example:
If a property is sold for $180,000. The transfer duties payable to the municipality will be:
0.5% of the first $50,000 = $250
1% of the next $130,000 = $1,300
(1.5% from $250,000 to $500,000 = n/a)
(2% of the portion exceeding $500,000=n/a)
Total= $1,550
Another example for a property sold for $300,000
0.5% x $ 50,000 = $250
1% x $200,000 = $2,000
1.5% x $50,000 = $750
2% – not applicable in this case.
Total= $ 3,000
For more information on the land transfer duties payable on a given transaction, please contact the municipality concerned.
Subscribe to The Montreal Real Estate Blog to get more info on closing costs.
Lets connect