Is land transfer tax payable when buying an easement or right of way in Ontario?

Ontario land transfer tax applies to transfers of interests in land, not only to transfers of full ownership (fee simple). Whether LTT applies to the grant or purchase of an easement or right of way depends on whether the particular interest being conveyed constitutes a registrable interest in land under Ontario law.

Easements appurtenant (attached to neighbouring land and registered on title) and rights of way that are registered as interests in land can attract LTT when they are purchased for value. The consideration paid for the easement or right of way would be the basis for calculating LTT.

In many commercial and infrastructure contexts, pipeline easements, utility rights of way, and access easements are purchased for significant consideration, and LTT is indeed payable on these transactions. Purely personal rights that do not constitute an interest in land (such as a licence that cannot be registered) would not attract LTT. If you are purchasing any interest that will be registered against someone else's title, have a lawyer assess the LTT implications before completing the transaction.