How To Add a Name To a House Title in Ontario

In Ontario, many homeowners are choosing to add a name to a house title to help them qualify for a mortgage or to reduce estate administration taxes after the owner's death. However, adding a name to a property title involves more than just a simple update. 

This legal process requires filing an electronic Land Transfer form with the Land Titles Office. By doing this, you are transferring a share of the property to the other person, making them a co-owner. 

Understanding the legal consequences of this action is necessary in order to make informed choices regarding your property. This article will guide you through the process, step by step, to add a name to your house title in Ontario successfully.

Key steps will include filling out a Transfer/Deed of Land form, obtaining a Statement of Adjustments, registering the transfer at the Land Registry Office, and updating your property tax information. 

Understanding House Titles in Ontario

Understanding house titles in Ontario is necessary for anyone involved in real estate transactions. Knowing the types and implications of house titles can help buyers and sellers understand the market with confidence.

What is a Title Transfer?

A title transfer refers to the legal process of changing the name(s) on the title of a property. In Ontario, property titles are registered with the Land Registry Office. To add or remove a name from the title, you must file an application for title transfer with the Land Registry Office in the county or district where the property is located.

Who Can Be Added to A Title?

You can add the name of a spouse, child, family member, or any other individual to the title of a property. But, before proceeding with a title transfer, you should consider the legal and financial implications. Adding someone to the title gives them equal ownership and rights to the property.

How to Transfer Title

To transfer title, you need to submit an Application for Transfer/Charge of Land at the Land Registry Office along with the required fees. The application must be signed by all current registered owners of the land as well as the new owner(s) being added. You will also need to provide proper identification for all parties.

The Land Registrar will review your application and documentation to ensure everything is in order before registering the change in title. It typically takes 4 to 6 weeks to process an application to transfer title. Once complete, the Land Registry Office will issue a Transfer/Deed of Land or register a Transfer Application to formally record the change in ownership.

Legal Considerations

Before proceeding with adding someone to the title of your property, consider consulting a real estate lawyer. A title transfer is a legally binding process, so you want to fully understand the implications, especially if adding someone who is not your spouse. 

You should have a co-ownership agreement in place to outline each party’s rights and obligations. This can help avoid uncertainties and conflicts in the future regarding the use, occupancy, maintenance, and sale of the property.

A lawyer can also advise you on estate planning and how title transfer may impact other legal documents like your will. It is important to keep all records up to date to properly reflect your ownership intentions.

Reasons to Add a Name to House Title

Adding a name to a house title can offer several advantages. This decision is often driven by financial or legal benefits, such as helping a relative qualify for a mortgage or reducing estate administration taxes. 

Protect Spousal Rights

Adding a spouse’s name to the title of the matrimonial home helps ensure their legal interest in the property. Should the relationship break down or in the event of death, having one’s name on the title provides security and protection. Without being on title, a spouse risks losing their right to the matrimonial home.

Useful Estate Planning Tool

Adding a spouse’s name to the title can be an important part of estate planning. Upon the death of one spouse, the surviving spouse will automatically inherit the entire property, avoiding delays and legal issues. This allows the surviving spouse to maintain ownership and occupation of the home.

Avoid Estate Administration Tax

In Ontario, there is an Estate Administration Tax of approximately 1.5% of the value of the estate. By adding a spouse’s name to the title, the value of the matrimonial home is excluded from the calculation of this tax upon the death of the first spouse. This could result in significant tax savings, especially for higher-value properties.

Provide Flexibility

Adding a spouse’s name to the title provides flexibility in the future. Should circumstances change, both spouses have the legal right to deal with the property as they choose, whether selling, refinancing, or other options. Neither spouse is able to legally sign off on any transactions involving the property.

Adding a spouse’s name to the title of the matrimonial home is an important legal safeguard and a useful estate planning tool. It helps provide security, flexibility and potential tax savings for married couples in Ontario. By taking this simple step, spouses can have the peace of mind that they both have a legal right to their home.

The Process of Adding a Name to a House Title in Ontario

Adding a name to the title of a property in Ontario requires following the official legal process to transfer ownership. You and the individual being added will need to fill out transfer of ownership documents, also known as “transfer of land” forms. These forms must be signed by all current registered owners of the property.

Obtain the Required Forms

The two main forms needed are the Application to Transfer Land and Property Transfer Tax Affidavit. These can be obtained from your local Ontario land registry office or downloaded from the province’s website. The Application to Transfer Land officially requests the title change, while the Property Transfer Tax Affidavit confirms whether land transfer tax is owed on the transaction.

Submit the Completed Forms

Once the forms have been filled out and signed, submit them to your local land registry office along with the required fees, which include both application and registration fees. The land registry staff will review the application to ensure all information is accurate and complete before officially registering the change of ownership.

Pay Any Owing Taxes

Adding a name to a property title may change the principal residence exemption status, resulting in capital gains tax implications. The transfer between spouses or former spouses can also be subject to land transfer tax. You are required to pay all taxes prior to the title transfer being finalized. The exact amount owing will depend on the specifics of your situation and property value. It is best to consult with a legal professional to determine potential tax liabilities.

Registration and Issuance of New Title

When all the documentation is in order and all taxes that a person or a company owning the piece of land owes, have been paid, the registrar of the land transfers the ownership of the property and issues a new title deed containing the names of all the new owners. 

The entire process normally takes 4 to 6 weeks to be completed till the last stage. New title holders can utilize the newly issued title as a means of showing legal ownership of the property in the future.

Therefore, proper legal procedure must be followed when putting a name on a house title to effectively transfer the ownership vested on the property. When it comes to matters related to fees and taxes, it is not wise to take shortcuts, as ownership rights could be at risk. A real estate lawyer can help one go through all formalities to facilitate title changes because of these uncertainties.

Risks of Adding a Name to House Title in Ontario

Adding a name to the title of your house in Ontario is an irreversible decision that comes with several risks to consider. Once a name has been added to the title, removing it can be an expensive and complicated legal process.

Tax Implications

Including another person's name on the title of your house is considered a taxable gift in Canada. This implies that you could experience tax implications, based on the home's fair market value and your province's tax regulations on gifts. 

In Ontario, a land transfer tax is applicable to gifts exceeding $10,000, for instance. It is advisable to seek guidance from a tax expert to ascertain if there will be any taxes due when including a name on the title.

Increased Liability

It means that when you include another person’s name alongside yours as the title to the house, you are providing them with legal rights of ownership over the house. This puts you in a vulnerable position to face risks such as lawsuit claims, personal bankruptcy or divorce cases that may lead to loss of your home. 

One disadvantage stems from the fact that if the other owner fails to pay his portion of the mortgage or property tax, you will suffer. It is important to consider these scenarios and whether you trust the individual before proceeding to add their name.

Complicated to Reverse

Getting someone’s name out of a house title once it has been put in is both time-consuming and costly. Usually, you will need the consent and signature of the other owner which they are likely to deny you. Where consent cannot be given, it might take a long time in the court in order to have their name removed. This can cost thousands of dollars in legal fees without necessarily winning the case. If you plan on permanently changing the title it is best to only add a name.

Including a name on the title of your house in Ontario is a significant choice that requires careful consideration. Confirm that you comprehend all possible risks and outcomes before moving forward to prevent potential challenges in the future. Consulting with legal and tax experts can assist you in understanding this procedure.

Now you have a solid understanding of how to legally add a name to a house title in Ontario. While the process involves some paperwork, time, and fees, it is straightforward as long as you carefully follow each step. 

By updating the title to list all owners' names, you can have peace of mind that your joint property is accurately recorded. This will ensure you have legal security. We hope this overview has equipped you to successfully add a name and finalize the home ownership details.