What is the land transfer tax affidavit and why must I sign it?
Every transfer of land registered in Ontario must be accompanied by a Land Transfer Tax Affidavit, which is completed and submitted electronically through the Teranet e-registration system at the time of closing. This affidavit is the mechanism by which the buyer discloses the nature of the transaction and the amount of consideration paid, which is then used to calculate the LTT owing.
Your real estate lawyer prepares the affidavit, but as the buyer you are required to swear or affirm the information in it. By signing, you are confirming under oath that the statements about the purchase price, the nature of the transaction, and any claimed exemptions or rebates (such as the first-time buyer rebate) are true.
Providing false or misleading information in the affidavit is a serious offence under the Land Transfer Tax Act and can result in penalties, reassessments, and potential fraud charges. The Ministry of Finance audits LTT filings and can reassess the tax many years after a transaction. Always review the affidavit carefully with your lawyer before signing.
Key takeaways
- A Land Transfer Tax Affidavit is required for every deed registration in Ontario.
- You swear or affirm that the disclosed purchase price and transaction details are accurate.
- Claiming a rebate falsely or understating consideration carries serious legal consequences.
- Review the affidavit carefully with your lawyer before signing.