Closing Costs in Ontario: The Exact Cash You Need on an $800,000 GTA Home

The Worked Example: $800,000 in Toronto vs Mississauga, Line by Line

Here is the direct answer most guides avoid giving you: on an $800,000 home, an eligible first-time buyer needs about $16,475 just for land transfer tax in Toronto, versus $8,475 in Mississauga — and that is before legal fees, title insurance, an inspection, an appraisal and adjustments. Altogether, Ontario buyers should budget closing costs of 1.5% to 4% of the purchase price on top of the down payment, with Toronto sitting toward the top of that range because its buyers pay land transfer tax twice.

This post keeps one discipline: it is about closing costs only. Your down payment is a separate pile of cash — if you need that math, see Buy a House With Just 5% Down. Confusing the two piles is the most common reason buyers arrive at closing short. Below, every line of an $800,000 purchase is worked out in Toronto and outside Toronto, so you can see exactly where the difference comes from and what you can legitimately reduce.

Read the table the way a lawyer's trust ledger reads it: land transfer tax dominates everything else, and the city line is worth $12,475 gross on this purchase. A repeat buyer in Toronto, who gets no first-time rebate, pays the full $24,950. A first-time buyer outside Toronto pays the least of the four combinations, $8,475, purely because only one level of land transfer tax applies and the Ontario rebate still helps.

Land Transfer Tax — Paid Twice in Toronto, Once Everywhere Else

Ontario's land transfer tax is charged on a sliding scale: 0.5% on the first $55,000, 1.0% on the portion from $55,000 to $250,000, 1.5% from $250,000 to $400,000, 2.0% from $400,000 to $2,000,000, and 2.5% above $2,000,000 for one or two single-family residences. Apply those brackets to $800,000 and the Ontario tax comes to $12,475.

Toronto is the only Ontario city with its own municipal land transfer tax, and it mirrors the provincial brackets. That is why Toronto buyers effectively pay the same tax twice: another $12,475 on an $800,000 home, for a gross total of $24,950. Mississauga, Brampton, Vaughan and every other GTA municipality charge no municipal land transfer tax at all. When two homes cost the same but sit on opposite sides of the Toronto boundary, this single line can differ by five figures — a fact worth knowing before you fall in love with a postal code.

Two practical points. First, land transfer tax is payable by the buyer on closing and cannot be added to your mortgage. It is cash, on the day, through your lawyer. Second, it is calculated on the purchase price, not on the amount you borrow, so putting less money down does not reduce it. Budget for it from the first day of your search, not the last week before closing.

The Costs Buyers Forget: PST on CMHC Insurance, Adjustments, Appraisal

PST on the Mortgage Insurance Premium

If you buy with less than 20% down, your mortgage requires default insurance from CMHC, Sagen or Canada Guaranty. The premium itself is normally added to your mortgage balance — but Ontario charges 8% provincial sales tax on that premium, and that tax cannot be added to the mortgage. It is payable in cash at closing. On a large insured mortgage, 8% of a premium that runs into the tens of thousands is a four-figure surprise for buyers who were never told it existed. Ask your mortgage professional for the exact figure as soon as your approval is firm, and put it in your cash-to-close list.

Adjustments and Prepaid Items

On closing, buyer and seller settle the running costs of the home between them. If the seller has prepaid property taxes or utilities beyond the closing date, you reimburse your share; if accounts are in arrears, the credit runs the other way. These adjustments are usually modest, but they are real cash on the statement of adjustments your lawyer prepares. Newer homes can also carry utility connection and development-related charges. Leave a buffer rather than budgeting to the last dollar.

Appraisal, Inspection and Title Insurance

Your lender may require an appraisal, typically $300 to $500. A home inspection, typically $400 to $700, is optional but money well spent — and in a market where buyers can keep conditions, there is little reason to skip it. Title insurance, typically $250 to $500, protects against a range of title and fraud issues and is arranged through your lawyer. For a condo purchase, add the document review itself; the certificate costs no more than $100 including taxes by law, as explained in Toronto Condo Status Certificate: 9 Red Flags to Check Before You Buy. None of these lines is large alone. Together they explain why the honest budget is a range — 1.5% to 4% of price — and not a single tidy number.

First-Time Buyer? Subtract Up to $8,475

First-time buyers get real help with the biggest line. Ontario's first-time buyer refund is worth up to $4,000 off the provincial land transfer tax, and Toronto's is worth up to $4,475 off the municipal tax. Combined, an eligible Toronto first-time buyer saves up to $8,475 — which is how the $24,950 gross tax on our $800,000 example becomes $16,475 net. Outside Toronto, only the Ontario refund applies, bringing $12,475 down to $8,475.

The eligibility test is strict, and it catches people out. You must be at least 18, a Canadian citizen or permanent resident, and occupy the home as your principal residence within nine months. Crucially, you must never have owned a home or an interest in a home anywhere in the world, and if you have a spouse, their ownership history matters under the program rules too. "First home in Canada" is not the test — "first home anywhere" is. Confirm your eligibility with your lawyer early, because claiming a rebate you do not qualify for creates a repayment problem later.

Beyond the rebates, remember the wider first-time stack when you plan the whole purchase: the First Home Savings Account, the RRSP Home Buyers' Plan, and the $10,000 home buyers' amount worth up to a $1,500 tax credit. Those programs help fund the down payment rather than the closing costs, but cash is fungible in a household budget — every dollar they contribute on one side is a dollar you can reserve for closing day on the other.

Extra Closing Costs on New and Pre-Construction Homes (HST, Levies, Occupancy Fees)

Everything above applies to resale homes. New and pre-construction purchases add a second layer, and buyers routinely underestimate it. Resale homes are generally exempt from HST on the price; new homes are not. New construction attracts 13% HST in Ontario, subject to available rebates — including, for eligible first-time buyers, the new federal GST/HST rebate worth up to $50,000 on the federal portion for new builds only, on builder agreements from 20 March 2025 onward. Do not assume any provincial matching figure you see advertised; confirm your exact rebate position with CRA guidance and your lawyer before relying on it.

Pre-construction buyers also face development levies and charges, utility hook-up fees, and — for condos — interim occupancy fees during the period between moving in and final registration, when you pay occupancy charges but do not yet hold title or a mortgage on the unit. These items are set out in the builder's documents and are a major reason pre-construction cash-to-close runs higher than resale. If you are weighing the two paths, the full comparison is in Pre-Construction vs Resale in the GTA in 2026: Which Really Costs Less?.

Your Cash-to-Close Checklist (Deposit ≠ Down Payment ≠ Closing Costs)

Keep three separate piles in your head — and, ideally, in your budget spreadsheet:

• The deposit is paid shortly after your offer is accepted and held in trust. It forms part of your down payment, but it is due weeks or months before closing, so the timing matters even though the dollars overlap.
• The down payment is the balance of your equity on closing day — for an $800,000 home with minimum down, $55,000 in total, being 5% of the first $500,000 plus 10% of the remaining $300,000.
• The closing costs are everything in this article: land transfer tax, legal, inspection, title insurance, appraisal, adjustments and the 8% PST on any mortgage insurance premium. Budget 1.5% to 4% of the price, Toronto at the top end.

Worked through, our $800,000 Toronto first-time buyer needs roughly $55,000 of down payment plus $16,475 of land transfer tax, plus a few thousand for legal and the smaller lines, plus the PST-on-premium amount if the mortgage is insured — a total cash requirement well above what "5% down" advertising suggests. The Mississauga twin needs the same $55,000 down but $8,000 less tax. Neither figure should scare you off buying. Both should be known before you write an offer, not discovered in your lawyer's office a week before closing.

FAQ: Closing Costs in Ontario

How much should I budget for closing costs in Ontario?

Budget 1.5% to 4% of the purchase price on top of your down payment. Toronto buyers should plan toward the top of that range because they pay both Ontario and Toronto land transfer tax. On an $800,000 Toronto home, land transfer tax alone is $24,950 gross, or $16,475 for an eligible first-time buyer after the combined $8,475 in rebates.

Can closing costs be added to my mortgage?

Most cannot. Land transfer tax is payable in cash on closing through your lawyer, and Ontario's 8% PST on a mortgage insurance premium must also be paid in cash — only the premium itself can be added to the mortgage. Legal fees, inspection, appraisal and title insurance are likewise paid at closing, from cash held separately.

Who pays land transfer tax in Ontario — buyer or seller?

The buyer pays land transfer tax in Ontario, calculated on the purchase price using the provincial sliding scale. In Toronto, the buyer also pays the municipal tax, which mirrors the provincial brackets, so the tax is effectively paid twice. Sellers do not pay it, though they have their own closing costs.

Do first-time buyers pay less land transfer tax?

Yes — eligible first-time buyers receive up to $4,000 off Ontario land transfer tax and up to $4,475 off Toronto's municipal tax, combined savings of up to $8,475. Eligibility is strict: never have owned a home anywhere in the world, at least 18, citizen or permanent resident, occupying within nine months.

Why are closing costs higher on a new or pre-construction home?

New homes attract 13% HST on the price, unlike resale homes, plus development levies, utility connection charges and, for condos, interim occupancy fees. Eligible first-time buyers can claim the new federal GST/HST rebate of up to $50,000 on the federal portion, but pre-construction cash-to-close still runs higher than resale.

Looking to Buy or Sell in Toronto & GTA?

Want your own cash-to-close number before you start viewing homes? Get the full line-by-line estimate for your price and city, so there are no surprises in the lawyer's office. Work With Raj Gill — call (647) 657-4224 or email nestkey11@gmail.com.