The $8,475 Toronto First-Time Buyer Rebate Almost Everyone Forgets

If you're buying your first home inside the City of Toronto, the government will give you back up to $8,475 on closing day. Not as a deduction, not as a future benefit, real money that comes off the cheque you wire to your lawyer. And every single year I meet buyers who didn't know about it, claimed it wrong, or had a lawyer who treated it like an afterthought.

Let's fix that.

Where the $8,475 actually comes from

When you buy a home in Ontario, you pay two land transfer taxes if you're inside Toronto: the Provincial LTT and the Toronto Municipal LTT. They're calculated on the same brackets up to $400,000, then they diverge. On a $700,000 home, a non-first-time buyer pays roughly $20,950 in combined LTT. A first-time buyer pays roughly $12,475. The difference comes from two separate rebates that stack:

Both are claimed at closing, both are administered by your lawyer, and both can disappear if anyone in the deal makes one of the mistakes below.

Who actually qualifies

To get either rebate, all of the following must be true:

• You're at least 18 years old.
• You will occupy the home as your principal residence within 9 months of closing.
• You have never owned a home anywhere in the world, at any time, in any percentage. Not a rental in another province. Not an inherited cottage. Not 5% of your parents' place to help them refinance.
• If you're married or common-law, your spouse cannot have owned a home during the time you were together. (If they owned one before you met and sold it before you became spouses, you may still qualify, talk to a lawyer.)

The mistakes that cost real money

Mistake 1: Not telling your lawyer at all. The rebate isn't automatic. Your real estate lawyer has to apply for it on the closing documents. If you don't bring it up, and they don't ask, it can get missed. Always confirm in writing before closing that they're claiming both rebates.

Mistake 2: Putting the home in only one name when both spouses qualify. If both you and your partner are first-time buyers, putting the title in only one name still gets you the full rebate, but if one of you doesn't qualify and you put it in joint names, the rebate is reduced proportionally. Talk to your broker and your lawyer about title structure before you sign anything.

Mistake 3: Buying with a non-qualifying co-buyer. If you bring in a parent or sibling as a co-borrower to help you qualify (which lenders allow), and they've owned property before, you only get the rebate on your share of the title. A 50/50 split with a non-qualifying parent cuts the rebate in half.

Mistake 4: Forgetting it's only on the first $400K of LTT. The rebate isn't a percentage of the whole tax. It's a flat cap. On a $1.2M Toronto home, you still only get the same $8,475 you'd get on a $500K home. So if you're buying near the cap, the rebate covers a much bigger percentage of your closing costs than it does on a luxury purchase.

How to actually claim it

Three things to do:

One, check the first-time buyer box on your offer paperwork and make sure your real estate agent flags it. Two, when you hire your lawyer, confirm in your first email that you're a first-time buyer and ask them explicitly to claim both the Ontario and Toronto rebates. Three, when your lawyer sends you the Statement of Adjustments before closing, look for the line items that show the rebates being credited. If you don't see them, ask. Don't assume.

$8,475 is real money. It's a kitchen appliance package. It's six months of property tax. It's the buffer that keeps you from being house-poor in your first year of ownership. Don't leave it on the table.