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The Land Transfer Tax Act does not recognize partnerships therefore if a partnership owns land it is the owner of a partnership unit that is the beneficial owner of the land for Land Transfer Tax purposes. To deal with partnership situations where a partner had a minimal ownership interest, Ontario Regulation 70/91 was introduced to provide a tax exemption for “de minimus” transfers of partnership interests. Specifically it provided for a general exemption from land transfer tax where a person acquired an interest in a partnership that did not give rise to an entitlement of more than 5% of the profits of the partnership. On February 18, 2016, the Ontario Ministry of Finance issued an amendment to the land transfer tax regulations so that if the acquiring entity is a trust, including a real estate investment trust or another partnership, the “de minimus” exemption is not available. This amendment is retroactive to 1989 The Finance Ministry’s background information suggests that the amendment is for “clarification. However this amendment appears to be a substantive change to the regulation.

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"This article provides information of a general nature only. It is only current at the posting date. It is not updated and it may no longer be current. It does not provide legal advice nor can it or should it be relied upon. All tax situations are specific to their facts and will differ from the situations in the articles. If you have specific legal questions you should consult a lawyer."

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