David, a first-time home buyer, is purchasing a detached home in London, Ontario for $750,000. His financing condition requires obtaining a conventional mortgage, meaning less than 80% LTV, so he avoids CMHC insurance. He has secured a mortgage for $600,000. David's salesperson must advise him on the amount of land transfer tax he will owe to the Province of Ontario. What is this amount?

Question: David, a first-time home buyer, is purchasing a detached home in London, Ontario for $750,000. His financing condition requires obtaining a conventional mortgage, meaning less than 80% LTV, so he avoids CMHC insurance. He has secured a mortgage for $600,000. David's salesperson must advise him on the amount of land transfer tax he will owe to the Province of Ontario. What is this amount?

Answer options:

• $10,475
• $10,975 ✅ $11,475
• $12,975

Correct answer: $11,475

Explanation: The Ontario Land Transfer Tax is calculated as follows: 0.5% on the first $55,000 ($275), 1% on the amount from $55,001 to $250,000 ($1,950), 1.5% on the amount from $250,001 to $400,000 ($2,250), and 2% on the amount from $400,001 to $750,000 ($7,000). Total: $275 + $1,950 + $2,250 + $7,000 = $11,475.