How to transfer property title to a family member in Ontario

Summary: Transferring property title to a family member in Ontario means a lawyer registers a new Transfer of Land in your names. A genuine gift usually attracts no land transfer tax, but the Canada Revenue Agency (CRA) still treats the transfer as a sale at fair market value, so capital gains can apply even when no money changes hands.

What does transferring title to a family member involve?

Transferring title means changing the registered owner of a property by registering a Transfer of Land in Ontario's electronic land registration system. It can mean gifting a home outright, adding a name, removing a name, or selling to a relative below market value.

Families do this for all kinds of reasons: adding a spouse after marriage, moving a parent's home to an adult child for estate planning, removing a former partner after a separation, or passing a cottage to the next generation. Whatever the reason, two separate sets of rules apply at the same time. Ontario's land transfer tax is provincial; capital gains tax is federal. They work independently, and a transfer that is free of one can still trigger the other.

How do you transfer title to a family member in Ontario?

A real estate lawyer handles the transfer: they confirm the current title, prepare the Transfer of Land, and register it electronically. In Ontario, only a licensed lawyer can register a transfer through the land registration system.

1. Confirm the current title and any mortgage. A title search shows who owns the property and what is registered against it, including any mortgage or lien.

2. Decide the structure. A gift, a sale, or a partial interest. If more than one person will be on title, choose joint tenancy or tenants in common, which determine what happens on a co-owner's death.

3. Get tax advice first. Confirm the land transfer tax and capital gains consequences before anything is registered, not after.

4. Address the mortgage. If a mortgage stays on the property, the lender's consent is usually required, and any balance the new owner assumes affects the tax (see below).

5. Prepare and sign the Transfer of Land. The lawyer verifies each person's identity. If the property is a matrimonial home, both spouses normally must consent under the Family Law Act.

6. Register and consider title insurance. The lawyer registers the transfer and can arrange an owner title insurance policy for the new owner.

Do you pay land transfer tax on a transfer to family?

You usually pay no Ontario land transfer tax on a true gift to a family member, because the tax is charged on the value of the consideration, and a gift with no money changing hands and no mortgage assumed has nil consideration. A mortgage the recipient assumes is the common exception.

If the person receiving title takes on a mortgage, the outstanding balance counts as consideration, and tax is payable on that amount regardless of the family relationship. Spouses are treated differently: transfers between spouses are exempt even when a mortgage is assumed or the transfer follows a written separation agreement.

What capital gains and tax traps should you watch for?

Even a gift is a "deemed disposition" for income tax. The CRA treats you as having sold at fair market value under section 69 of the Income Tax Act, so if the property is not your principal residence, you may owe capital gains tax even though no money changed hands.

• Principal residence exemption. If the home was your principal residence for every year you owned it, the exemption can reduce or eliminate the gain. A cottage or rental property rarely qualifies in full.

• The "$1 transfer" myth. Selling to family for $1 does not avoid tax. The CRA still values the disposition at fair market value, and a token price can create double taxation, because the recipient's cost base may be the $1 they paid rather than the property's real value.

• Spousal rollover. A transfer to a spouse happens at your original cost by default, deferring the gain, unless you elect out. Future income and gains may also attribute back to you.

• Minor children. Income (such as rent) on property given to a child under 18 can attribute back to you under the attribution rules, though capital gains the child later realizes on a sale generally do not.

Should you add an adult child to title to avoid probate?

It is a common estate-planning move, because property that passes outside the estate avoids Ontario's Estate Administration Tax (roughly $15 per $1,000 of estate value above $50,000). The savings are real, but so are the risks, and they often outweigh the tax.

• It is a gift today. Adding a child as a joint tenant gives them a share now, which is a deemed disposition and may trigger capital gains immediately.

• Exposure to their life. A co-owner's share can be drawn into their creditor claims or a marital breakdown.

• Loss of control. You generally cannot sell or refinance without the co-owner's signature.

• Resulting-trust uncertainty. For a gift to an adult child, the law presumes the child holds the interest in trust for your estate unless you clearly intended an outright gift (Pecore v. Pecore, 2007 SCC 17), which can lead to disputes later.

A lawyer and an accountant can weigh the probate savings against these risks before anything is registered.

Frequently asked questions

Can I transfer my house to my child for $1 in Ontario?

You can register the transfer, but the $1 price does not lower your tax. The CRA values the disposition at fair market value, and a token price can cause the same gain to be taxed twice. Get tax advice before registering.

Do I need a lawyer to transfer title to a family member?

Yes. Only a licensed Ontario lawyer can register a Transfer of Land, and the lawyer confirms the title, handles any mortgage, verifies identity, and flags the tax consequences before registration.

Is there land transfer tax when adding a spouse to title?

No. Transfers between spouses are exempt from Ontario land transfer tax, even if the spouse takes on part of the mortgage or the transfer follows a written separation agreement.

Does giving my home to my children trigger capital gains?

It can. A gift is treated as a sale at fair market value, so any increase in value since you bought the property may be taxable, unless the principal residence exemption applies for all the years you owned it.

Can I remove someone from title after a separation?

Yes, usually through a transfer that reflects your separation agreement or a court order. If the property is a matrimonial home, both spouses normally must consent to the transfer under the Family Law Act.

About the author

Joel Fox is a co-founder and COO at Ownright. He helps run the firm's day-to-day work on Ontario residential closings, refinances, and sales, and writes regularly to demystify the parts of a transaction that most homeowners only encounter once or twice in their lives.

At Ownright, we focus entirely on Ontario residential real estate law. We pair a simple digital platform with an in-house team of licensed Ontario lawyers, and we help homeowners with purchase closings, refinances, sales, status certificate reviews, and changes to title and ownership. You can start your closing online or get in touch with any questions.

Legal references: Land Transfer Tax Act, R.S.O. 1990, c. L.6; R.R.O. 1990, Reg. 696 (exemptions for transfers between spouses); Income Tax Act, R.S.C. 1985, c. 1 (5th Supp.), ss. 69 and 73; Estate Administration Tax Act, 1998, S.O. 1998, c. 34, Sched.; Family Law Act, R.S.O. 1990, c. F.3, s. 21; Pecore v. Pecore, 2007 SCC 17.

Important note: This article is not legal advice. No one should act, or refrain from acting, based solely on the information in this post or any linked materials without first seeking appropriate legal or professional advice.