Taxes for new homeowners
When and how should you pay your “welcome tax” when you buy a home? Under which circumstances are reimbursements or exemptions allowed? If you have recently bought a home or condo in Montréal, here’s what you need to know.
Property transfer duties
Property transfer duties, commonly called the “welcome tax,” are generally billed six to nine months after your transaction with the notary. If you buy a new home, it may be longer. You must pay your taxes in one instalment within 30 days of the billing date on the tax account invoice.
Do you have a child under age 18? You could be eligible for the Home Ownership Assistance Program. Please see the program to learn more about eligibility criteria.
In some cases, the usual amount of property transfer duties is waived for buyers. This is known as an exemption.
An exemption may be applicable to some transactions:
- Between members of the same family
- From a physical person to a legal entity (company, organization)
Buildings that are not in the land registry
Some property transfers may not be registered in Québec’s land registry.
Buyers must still pay property transfer duties and must disclose the sale.
Annual tax account
As a new owner, you are responsible for paying property taxes. Tax account invoices are usually mailed out at the end of January each year. They are payable in one or several instalments.
Generally, when the building is sold, the notary calculates the division of tax payment for the current year between the buyer and the seller.
The city does not re-issue a tax account when a building is sold. It is the responsibility of the new owner to ensure that municipal taxes are paid.