Land Transfer Tax: Your Biggest Closing Cost

Ontario's Land Transfer Tax (LTT) is calculated on a sliding scale. On a $650,000 duplex: 0.5% on first $55,000 = $275; 1% on $55,001–$250,000 = $1,950; 1.5% on $250,001–$400,000 = $2,250; 2% on $400,001–$2,000,000 = $5,000. Total LTT: $9,475. If buying in Toronto, add the Toronto Municipal LTT on top — approximately equal to the provincial LTT. First-time buyers qualify for provincial rebates up to $4,000.

Legal Fees and Disbursements

Budget $1,800–$3,000 for real estate legal fees on a duplex purchase. Disbursements (title searches, registration fees, couriers) add $500–$800 on top. Investment property closings are typically $300–$500 more than primary residence closings due to additional searches (rental history, tenancy status, LTB application history). Use a lawyer who has closed duplex transactions — they'll know what to look for.

Adjustments: The Surprise Items

On closing day, you'll pay or receive several adjustments — credits and debits for items that have been pre-paid or underpaid by the seller. Common adjustments on duplexes: property taxes (seller may have pre-paid taxes for a period after your closing date — you'll credit them), fuel oil or rental equipment (water heater rental contracts transfer to you — budget for these), and rent prepaid by tenants (if tenants paid first/last, you'll receive this from the seller).

HST on New Builds and Conversions

If you're buying a newly built duplex or a substantially renovated property, HST may apply. The New Residential Rental Property Rebate can recover a significant portion of this for properties intended as rentals, but it requires filing within two years of closing. Not applicable to resale properties. Consult your lawyer and accountant before closing if you're buying anything less than 10 years old.

Closing Cost Summary by Purchase Price

$500,000: LTT ~$6,475, legal $2,200, title insurance $350, inspection $600, total ~$9,625. $650,000: LTT ~$9,475, legal $2,400, title insurance $400, inspection $650, total ~$12,925. $800,000: LTT ~$12,475, legal $2,800, title insurance $450, inspection $700, total ~$16,425. Rule of thumb: budget 2–2.5% of purchase price for closing costs on a resale duplex in Ontario.