How Much to Budget for Buyer Closing Costs in Ontario

Your down payment is only part of the cash you need to buy a home. On closing day there is a second group of one-time costs, and buyers who have not planned for them are often caught short.

This article walks through the main items an Ontario buyer should expect, starting with a general budgeting range and then taking each cost in turn. Your own numbers will depend on your agreement of purchase and sale, so treat this as a checklist to bring to your lawyer.

A starting range for closing costs

The Financial Consumer Agency of Canada describes closing costs as one-time fees paid when you buy a home, such as inspection fees, legal fees, property tax adjustments and title insurance. It says buyers should budget 1.5% to 4% of the purchase price for them.

That range is a planning tool, not a quote. A buyer of a new build, a non-resident buyer or a buyer in Toronto can land outside it, and the items below show why.

Ontario land transfer tax

Land transfer tax is calculated in brackets on the value of the consideration. Each rate applies only to the portion of the value that falls within its bracket. For agreements entered into after November 14, 2016 and registered on or after January 1, 2017, the rates are:

If the land has one or two single family residences, the rate on the part of the value over $2,000,000 is 2.5%. Single family residences include cottages and cabins, and the zoning of the land does not matter.

The value of the consideration includes the purchase price, any liabilities assumed, benefits conferred, soft costs and the cost of upgrades. It does not include HST paid on the purchase price. The tax is paid when the transfer is registered on closing, or before then.

Toronto charges its own Municipal Land Transfer Tax on top of the provincial tax. It is not calculated here, so if you are buying in Toronto, add it separately.

The first-time buyer refund

First-time homebuyers can get a refund of Ontario land transfer tax of up to $4,000 for conveyances on or after January 1, 2017. You must be at least 18, must never have owned a home or an interest in a home anywhere in the world, and must occupy the home as your principal residence within nine months of the transfer.

The refund can be claimed at registration through the electronic land transfer tax affidavit. If it is not claimed then, you pay the tax and apply to the Ministry of Finance, within 18 months after the conveyance is registered.

Several exceptions can reduce or remove the refund:

• If your spouse owned a home while married to you, you do not qualify, and neither spouse can get the refund.
• If you buy jointly and one buyer is not a first-time buyer, the refund is reduced and is proportionate to the interest acquired by the buyers who qualify.
• For agreements signed after November 14, 2016, you must be a Canadian citizen or permanent resident. A buyer who is not one at closing has 18 months after registration to become eligible and apply.

Registration, title insurance and other closing items

• Registration fee: effective November 3, 2025, the fee to register an instrument electronically in Ontario, such as a transfer, is $85.00. It is made up of a $71.55 statutory fee, an $11.90 ELRSA fee and $1.55 HST.
• Title insurance: it is not required by law in Ontario. A standard owner's policy generally covers hidden defects in ownership, existing liens, encroachments, survey and public-record errors, and title fraud. A lender's policy is a separate product that protects the mortgage lender.
• Legal fees and disbursements: these vary by file and by lawyer, so ask for an estimate.
• Adjustments: property tax and similar items are adjusted between buyer and seller on closing. The details come from your agreement of purchase and sale, so read that document closely.

Title insurance has limits. A standard policy generally excludes defects you knew about before buying, environmental hazards, native land claims, zoning violations from later renovations, and problems unrelated to title. A victim of title fraud may also claim compensation from the government's Land Titles Assurance Fund.

Extra costs for some buyers

Non-Resident Speculation Tax (NRST) is 25% of the value of the consideration, effective October 25, 2022. It applies to residential property anywhere in Ontario bought by foreign nationals, foreign corporations and taxable trustees, and it is charged in addition to Ontario land transfer tax. A foreign national is an individual who is not a Canadian citizen or permanent resident, and First Nations individuals registered under the federal Indian Act are excluded from the definition. Exemptions may be available for a nominee, a protected person or the spouse of a Canadian citizen, and supporting documents may be required.

If you are buying a new home, the builder pays the Tarion enrolment fee, but vendors commonly pass it to buyers in the statement of adjustments. From September 1, 2025 the schedule includes a $55-per-home adjustment, and the average fee is $1,790. Whether your builder may pass it on depends on your agreement of purchase and sale and the Tarion Addendum.

Paying on closing day and what to do next

A lawyer or paralegal in Ontario may not accept more than $7,500 in cash for any one client file, including on the purchase of real property. There are narrow exceptions, such as cash received to pay a fine, a penalty or bail. In practice, plan to deliver your closing funds by non-cash methods, and ask your lawyer which methods they accept.

• Start with 1.5% to 4% of the price as a rough closing-cost budget.
• Work out the Ontario land transfer tax on your price, and add Toronto's municipal tax separately if it applies.
• Check whether you qualify for the first-time buyer refund, and ask that it be claimed at registration.
• Ask your lawyer for estimates of legal fees, disbursements and the registration fee.
• Decide whether to buy title insurance and ask what the policy excludes.
• If you are a foreign national, ask about NRST and any exemption before you sign.
• For a new build, ask what adjustments the builder will charge.
• Arrange non-cash funds in good time before closing.

Frequently asked questions