Short answer: budget roughly 1.5-4% of your purchase price for closing costs in Ottawa, land transfer tax, legal fees, title insurance, and adjustments. On a $500,000-$600,000 home, Ontario land transfer tax alone runs $6,475 to $8,475 before any rebate, and first-time buyers can knock up to $4,000 off that with the provincial rebate.
Ontario Land Transfer Tax: How It's Calculated
Ontario land transfer tax is calculated on a sliding scale, each portion of your purchase price is taxed at a different rate:
- 0.5% on the first $55,000
- 1.0% on the portion from $55,000 to $250,000
- 1.5% on the portion from $250,000 to $400,000
- 2.0% on the portion from $400,000 to $2,000,000
- 2.5% on the portion above $2,000,000
Ottawa does not charge a separate municipal land transfer tax on top of this (Toronto does, which is why Toronto buyers pay roughly double). Ottawa buyers only pay the provincial tax.
The First-Time Buyer Rebate
If this is your first home purchase, Ontario rebates up to $4,000 of your land transfer tax automatically at closing, your lawyer applies it directly, you don't need to file separately for it. On a purchase price of roughly $370,000 or less, this rebate can eliminate your land transfer tax entirely; above that, it simply reduces what you owe.
What Else Is Included in Closing Costs
- Legal fees: typically $1,200-$2,000 for a standard residential closing
- Title insurance: usually $250-$400, protects against title defects and fraud
- Home inspection: $400-$600, technically pre-offer but budgeted alongside closing costs
- Adjustments: reimbursing the seller for prepaid property tax or utilities covering periods after your closing date
- Mortgage default insurance premium (if your down payment is under 20%), which can be added to your mortgage rather than paid in cash
Run Your Own Numbers
Our free Land Transfer Tax calculator runs the exact provincial formula and rebate for your specific purchase price, no need to do the math by hand.
Budgeting for Closing Day
The rule of thumb is 1.5-4% of your purchase price in total closing costs, land transfer tax makes up the majority of that. We build this into your pre-approval conversation upfront, so there are no surprises when your lawyer sends the final statement of adjustments.