Toronto City Council passed an amendment on December 17, 2025 introducing graduated Municipal Land Transfer Tax (MLTT) rates for high-value residential properties containing one or two single-family residences. The new rates take effect April 1, 2026. For Toronto-area owner-managers — many of whom are weighing a personal home purchase or sale alongside year-end corporate decisions — this is a dated, concrete change worth factoring into anything closing after April 1. It arrives at the same time as the usual December corporate year-end planning window, so this post covers both: the MLTT change itself, and the practical checklist worth running before your fiscal or calendar year closes.
The graduated MLTT rates, in detail
Toronto's MLTT applies to all property purchases in the city, on top of Ontario's provincial Land Transfer Tax. Historically it used a single rate schedule for all residential property. The December 17 amendment splits that schedule for single-family homes (one or two units) valued above $3 million, introducing five new graduated brackets on top of the existing rates:
| Value of consideration | MLTT rate |
|---|---|
| Up to $55,000 | 0.5% |
| $55,000.01–$250,000 | 1.0% |
| $250,000.01–$400,000 | 1.5% |
| $400,000.01–$2,000,000 | 2.0% |
| $2,000,000.01–$3,000,000 | 2.5% |
| $3,000,000.01–$4,000,000 (new, effective April 1, 2026) | 4.40% |
| $4,000,000.01–$5,000,000 (new, effective April 1, 2026) | 5.45% |
| $5,000,000.01–$10,000,000 (new, effective April 1, 2026) | 6.50% |
| $10,000,000.01–$20,000,000 (new, effective April 1, 2026) | 7.55% |
| Over $20,000,000 (new, effective April 1, 2026) | 8.60% |
Source: City of Toronto — Municipal Land Transfer Tax & Municipal Non-Resident Speculation Tax: Rates & Fees.
The brackets up to $3,000,000 are unchanged. The new graduated rates apply only to properties with one or two single-family residences — non-single-family residential properties (condos in larger buildings, multi-unit residential beyond a duplex) continue under the existing flat schedule, which tops out at 2.0% above $400,000. This is a tax targeted specifically at high-value detached and semi-detached homes, not at commercial property or investment real estate generally.
Why the April 1 effective date matters for a December decision
Because Council decided this in mid-December but delayed the effective date to April 1, 2026, there is a roughly three-and-a-half-month window where the old rate schedule still applies. For a Toronto-area owner-manager or their family already in the process of buying a home valued above $3 million, the difference between closing before and after April 1 is substantial: a $5 million purchase closing under the old rules pays MLTT at rates topping out at 2.5% above $2 million; the same purchase closing after April 1 pays the new graduated rates, reaching 5.45% on the portion between $4 million and $5 million. On a purchase of that size, that difference is worth budgeting for explicitly, not discovering at closing. Anyone with an accepted offer or an active search for a home in this range should confirm the anticipated closing date against April 1 with their real estate lawyer now.
The Municipal Non-Resident Speculation Tax (MNRST) — a separate 10% tax on the purchase price for foreign buyers of certain residential property, in effect since January 1, 2025 — is unaffected by this change and continues to apply on top of MLTT where relevant.
December is also year-end planning season — three items already on the calendar
Independent of the MLTT change, December is the natural checkpoint for Toronto owner-managers to confirm their corporate and personal tax position before the calendar closes — including keeping an eye on Ontario small business tax proposals still working through the legislative process rather than acting on them early:
- The Ontario small business limit remains $500,000 for now. A private member's bill, Bill 12 (the Cutting Taxes on Small Businesses Act, 2025), proposes raising it to $600,000, but as of December 2025 it had reached only First Reading in the Legislature and was not law. Base your 2026 instalment estimates on the confirmed $500,000 limit until any change actually passes. See our guide to the small business deduction limit for how the federal and Ontario limits interact today.
- The Ontario small business rate remains 3.2% for now. Any cut to that rate is a matter for the 2026 Ontario Budget, which had not been tabled as of this writing. If your corporation has an off-calendar year-end, plan instalments off the current confirmed rate rather than a proration that hasn't been legislated — model today's numbers with our corporate tax calculator and revisit once the Budget lands.
- Capital purchases and bonus/dividend timing. As with any year-end, confirm whether planned equipment or asset purchases should close before December 31 for this year's write-offs, and whether a salary/bonus/dividend mix set earlier in the year still matches your actual 2025 results now that the numbers are close to final.
What Toronto-area owners should do before year-end
- If you're buying or selling a single-family home above $3 million: confirm the anticipated closing date against April 1, 2026 with your lawyer, and budget for the graduated rate if closing falls after that date.
- If your corporation is near the $500,000 small business limit: plan your 2026 instalments off the confirmed $500,000 limit — a Bill 12 proposal to raise it to $600,000 remained unpassed as of December 2025.
- If your fiscal year straddles mid-2026: any Ontario small business rate cut below the current 3.2% would come from the 2026 Ontario Budget, not yet tabled — don't build a proration into your return until it's actually legislated.
- If you have planned capital purchases: confirm timing against your fiscal year-end for this year's versus next year's write-offs.
- If your compensation mix (salary vs. dividends) was set early in the year: revisit it now that 2025 results are largely known, rather than after year-end when adjustments are harder to make.
Key takeaways
- Toronto City Council approved graduated MLTT rates for single-family homes over $3 million on December 17, 2025, effective April 1, 2026, with new brackets reaching 8.60% above $20 million.
- Rates up to $3 million are unchanged; the new brackets apply only to one- or two-unit single-family residential property, not condos, multi-unit buildings, or commercial real estate.
- A purchase or sale above $3 million closing before versus after April 1, 2026 can mean a materially different MLTT bill — confirm your closing date now if you're in this range.
- The Ontario small business limit remains $500,000 and the rate remains 3.2% today; a private member's bill proposing a $600,000 limit had not passed as of December 2025, and any rate cut awaits the 2026 Ontario Budget — plan year-end instalments off today's confirmed numbers, not proposals.
- December is the practical checkpoint to align real estate closing timing, corporate tax positioning, and compensation decisions before the calendar year closes.
If you're weighing the timing of a high-value home purchase against the April 2026 MLTT change, or want your year-end corporate and personal tax position reviewed before December 31, RN Canada works with Toronto-area owner-managers remotely from our Edmonton and Vancouver offices on exactly this kind of planning.