Land Transfer Tax

One of the most common questions I get from buyers is about Land Transfer Tax (LTT). When you purchase a home, bare land or a condominium in Manitoba you pay the tax. Land transfer tax is calculated based on the value of the property (purchase price) on the date of registration of a transfer of title.

The calculations are: 

First $30,000: 0%

$30,0001 - $90,000: .05%

$90,001 - $150,000: 1.0%

$150,001 to $200,000: 1.5% 

$200,000+: 2.0%

When the act was implemented the purpose of the tax was to cover administrative expenses. Today, the tax has become a major revenue source for the government bringing in upwards of $90 million dollars annually. Back in 1987 the land transfer tax on an average-priced residential property was $250, today it is $3,689. The rising cost of the tax is due to the fact that the tax brackets haven’t changed since it was first implemented. 

In my opinion first time home buyers should be exempt from the tax. Manitoba and Alberta are the only provinces outside of Atlantic Canada that do not provide tax relief for first time home buyers. Alberta is the only province that does not have land transfer tax. 

I should also mention that Land transfer tax is collected at the time of closing by your lawyer so the buyers are responsible for the full land transfer tax amount at time of closing. If the property you are purchasing is in Brandon and if possession is after June 30th you may be responsible for the remaining full 2019 Property Tax amount at the time of closing as well. 

For more information, please refer to the Manitoba Real Estate MREA Feature article from February 2019.

Ericka Fowler
204.573.1995

www.erickafowler.com

 

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