Calculation of the property transfer tax

The calculation of the property transfer tax is based on the higher of the following amounts: the price paid for the acquisition of the building (including the value of any property given in exchange by the buyer); the sale price recorded in the transfer deed; the market value of the building (which usually corresponds to the value entered on the municipality's property assessment roll; this value must be multiplied by a factor to take into account the actual market value).

It is from this amount that the real estate transfer tax is calculated, according to the following rates (general provincial rates for 2020):

0.5% on the first $ 51,700;

1.0% on the portion of $ 51,700.01 to $ 258,600;

1.5% on the portion that exceeds $ 258,600.

For example, for a house valued at $ 250,000, the transfer tax is $ 2,241.50: the first $ 51,700 are taxed at the rate of 0.5% ($ 51,700 x 0.5% = $ 258.50); the remaining $ 198,300 is taxed at the rate of 1.0% ($ 198,300 x 1.0% = $ 1,983); the transfer tax corresponds to the total of the amounts payable for the different tranches ($ 258.50 + $ 1,983 = $ 2,241.50).

A municipality may also adopt a by-law to fix a higher rate on any tranche that exceeds $ 500,000. For example, the rates that apply in Montreal are as follows:

0.5% on the first $ 51,700;

1.0% on the portion of $ 51,700.01 to $ 258,600;

1.5% on the portion of $ 258,600.01 to $ 517,100;

2.0% on the portion of $ 517,100.01 to $ 1,034,200;

2.5% on the portion of $ 1,034,201 to $ 2,000,000;

3.0% on the portion that exceeds $ 2,000,000.

The amounts used to establish the various tranches are indexed annually according to the rate of increase of the index of all consumer prices for Quebec. 

Source: Services Québec