Disbursements on an Alberta Home Purchase: What They Cover

A disbursement is an out-of-pocket cost your lawyer pays to a third party on your behalf, such as a government office, and then lists on your account. When you read your reporting letter, several of these lines can look unfamiliar.

This article explains the common ones and what each is for. Exact amounts for many items depend on current fee schedules, so your lawyer's figures are the ones to rely on.

This article covers the law of Alberta.

Land Titles registration charges

Alberta charges no land transfer tax on a home purchase. Instead, buyers pay Land Titles registration charges based on the value of the land, generally the purchase price.

Under the Land Titles Act, the transferee pays a levy of $50 plus $5 for each $5,000 or portion thereof of the value. Any part of a $5,000 increment is charged as a full increment. For example, a $400,000 value gives $50 + 80 × $5 = $450.

The $5 per $5,000 rate applies to submissions received on or after October 20, 2024. Before then it was $2 per $5,000 for transfers and $1.50 per $5,000 for mortgages. Older guides may show outdated figures.

There are exceptions to the transfer levy. It does not apply to the Crown in right of Canada or the Crown in right of Alberta, although it does apply to agents of the Crown in right of Alberta, the Minister of Municipal Affairs acting under Part 10 of the Municipal Government Act, and the Public Trustee. For a lease, the value used is either the land's value including intended leasehold improvements, or 5% of that value multiplied by the years remaining in the lease term.

The mortgage registration levy

If you use a mortgage, the mortgagor pays a levy of $50 plus $5 for each $5,000 or portion thereof of the principal secured. It is calculated on the principal, not the purchase price, and a buyer paying cash with no mortgage does not pay it.

There are exceptions. If a new mortgage is from the same lender as an existing one and is supplemental, collateral, a substitute or a partial replacement, the levy is calculated only on the additional amount. An agreement amending a mortgage to increase the interest or principal carries the levy on the additional amount only.

If the Registrar does not accept the transfer instrument, the transfer levy is returned to the transferee, and the same applies to the mortgage levy.

GST and new homes

Alberta has no provincial sales tax, so no PST is charged on a home purchase. Only federal GST can apply, to new homes and certain other cases. GST is charged at 5% of the value of the consideration on a taxable supply, and the buyer pays it.

On a new home bought from a builder, GST is payable on the full consideration at final closing, when possession is transferred to you. That comes from a 1998 CRA policy statement that may not reflect later changes, so confirm the current approach with your lawyer. Buyers of new condominium units also pay GST on the purchase price, and the GST/HST New Housing Rebate can reduce it on a declining scale based on price.

The New Housing Rebate requires that the home be bought or built as your (or a relation's) primary place of residence. A recreational cottage or investment property does not qualify. A claim must be made within two years after the base date. You may assign the rebate to the builder so it is credited against the price at closing.

For the First-Time Home Buyers' rebate on a home bought from a builder, the purchase agreement generally must be dated on or after March 20, 2025. The builder can usually credit the rebate at closing, otherwise you apply using Form GST190 or through your CRA account. A substantial renovation generally means 90% or more of the existing house's interior is removed or replaced.

Resale homes are generally exempt from GST when the seller is not a builder of the home. There are exceptions, for example if the seller claimed an input tax credit on the last acquisition of the home. A resale condo may also attract GST where the seller used the unit mainly for business, claimed input tax credits for improvements, or the unit was substantially renovated.

Other common third-party costs

Fees for document and plan registration are listed in the Tariff of Fees Regulation (AR 120/2000) and must be paid at submission. Land Titles fees can be paid in person by cash, cheque, credit or debit, and cheques are payable to the Government of Alberta. Other fees, such as for a new title, depend on the current schedule, so ask your lawyer for the amount.

• Tax certificate: issued by the municipality on request, showing taxes imposed, taxes owing, arrears and deferred taxes.
• Title search and courier: costs of confirming ownership and delivering documents; the amounts vary.
• Title insurance: not required by the standard Alberta residential purchase contract.
• Real Property Report: the standard contract requires one, and title insurance does not replace it.

The tax certificate matters because property tax is a debt due to the municipality and a special lien on the land and improvements, which is why unpaid taxes are dealt with at closing. Tax arrears are taxes that remain unpaid after December 31 of the year in which they are imposed, and a penalty is part of the tax on which it is imposed. How taxes are shared between you and the seller is generally set by your purchase contract, so read that part carefully. Property taxes are also an ongoing cost to budget for after you move in.

Title insurance, briefly

Title insurance protects against problems with title, such as bylaw breaches and liens from unpaid contractors. A lender's policy protects only the lender, while an owner's policy can cover some non-title issues such as encroachments.

What to do next

• Ask for an estimate of disbursements before closing.
• Check whether your mortgage levy matches the principal borrowed.
• If you are buying a new home, ask whether GST applies and whether a rebate can be credited at closing.
• Confirm whether title insurance is being added and why.
• Ask about any line you do not recognize.
• Keep the reporting letter with your closing records.

Frequently asked questions