Montréal applies the most progressive welcome tax scale in Quebec: 7 tiers that rise from 0.5% to 4.0% for transactions above $3,113,000. On a $2,000,000 income property the duty works out to approximately $39,800 — significantly less than in municipalities that cap at 3% above $500,000, but the 2.5% tier that applies to the portion between $1,104,700 and $2,136,500 still represents a substantial closing cost. Combined with property taxes running around $0.46 per $100 of assessed value for buildings of 6 or more units, Montréal's tax burden on a multiplex is substantial and must be factored into any yield analysis. This guide details the full 2026 scale, walks through the bracket-by-bracket calculation, and reviews the available exemptions. Figures are indicative (2026): confirm with the City of Montréal and the assessment roll.
What is the welcome tax and who pays it in Montréal?
The "welcome tax" is the popular name for the real property transfer duty (droit de mutation immobilière). It is governed by the Act respecting duties on transfers of immovables and applies each time a property in Montréal changes hands — whether it is a condo, a duplex, or a large apartment building.
The essential point: the buyer pays this duty, not the seller. The City of Montréal bills the new owner after the deed is registered, typically within weeks or months of signing before the notary. For the general provincial mechanism and thresholds, see our guide on the welcome tax and our provincial overview article Welcome Tax 2026.
What is Montréal's welcome tax scale for 2026?
Montréal has enacted supplemental municipal rates that go well beyond the basic provincial scale, creating 7 brackets. Here is the complete applicable scale:
| Bracket of the tax base (2026) | Rate | Source |
|---|---|---|
| $0 to $62,900 | 0.5% | Provincial |
| $62,900 to $315,000 | 1.0% | Provincial |
| $315,000 to $552,300 | 1.5% | Provincial |
| $552,300 to $1,104,700 | 2.0% | Municipal |
| $1,104,700 to $2,136,500 | 2.5% | Municipal |
| $2,136,500 to $3,113,000 | 3.5% | Municipal |
| Over $3,113,000 | 4.0% | Municipal |
Source: provincial brackets from the Act respecting duties on transfers of immovables (CQLR c D-15.1); municipal brackets from the City of Montréal's transfer duty by-law. The provincial thresholds ($62,900; $315,000; $552,300) are indexed annually and the municipal thresholds ($1,104,700; $2,136,500; $3,113,000) may be adjusted by the City. Confirm current values with the City of Montréal before closing.
Lower top rate than some suburbs — but more brackets
Montréal's top rate (4%) only kicks in above $3,113,000 — much higher than the $500,000 threshold used by many suburban municipalities. For a $2,000,000 property the effective rate is lower than in cities that apply 3% above $500,000, but the 2.5% bracket that spans from ~$1.1M to ~$2.1M remains a significant cost to budget for.
What is the tax base?
The duty applies to the highest of: the price paid, the consideration stipulated in the deed, and the standardized assessment value (roll value multiplied by the comparison factor). For an income property, the roll value may be established on an income approach, so it can track the sale price closely.
How much is the welcome tax on a $2,000,000 income property in Montréal?
Applying the 2026 Montréal scale to a $2,000,000 property (assuming the price is the highest amount and equals the tax base):
- $62,900 × 0.5% = $314.50
- ($315,000 − $62,900) = $252,100 × 1.0% = $2,521.00
- ($552,300 − $315,000) = $237,300 × 1.5% = $3,559.50
- ($1,104,700 − $552,300) = $552,400 × 2.0% = $11,048.00
- ($2,000,000 − $1,104,700) = $895,300 × 2.5% = $22,382.50
- Total ≈ $39,825
The welcome tax would be approximately $39,800 on this transaction. Compare this to a municipality applying 3% above $500,000 on the same property, where the duty would be about $50,600 — Montréal's multi-tier structure is actually more favourable for properties in the $1–3M range. These figures are indicative (2026); indexed thresholds must be confirmed with the City of Montréal.
To put this cost in a profitability context, use the cap rate calculator and the GRM calculator.
What property taxes apply to an income property in Montréal?
Separate from the one-time transfer duty, income property owners in Montréal pay annual property taxes. For buildings of 6 or more units, the 2026 rate is approximately $0.46 per $100 of assessed value — roughly double the rate for an owner-occupied home.
Important nuances:
- The rate varies by property category (1–5 units vs. 6+ units vs. non-residential). Confirm the applicable category with the City.
- Borough charges and other tarifications (water, infrastructure) may be added depending on the borough.
- Income properties are assessed using an income approach, so the roll value is directly linked to the rents and the market cap rate — a rising market can quickly increase assessed values.
For the impact of income on valuation, see our tools for cap rate and GRM. The only authoritative numbers are on your tax bill and the City of Montréal assessment roll.
What transfer duty exemptions exist in Montréal?
The Act provides exemptions applicable across all Quebec municipalities, including Montréal:
- Transfers between spouses (married, civil union, or common-law couples meeting the statutory conditions).
- Transfers between relatives in a direct line (parents–children, grandparents–grandchildren) — relevant for real estate inheritance.
- Certain transfers to or from a corporation under strict conditions (control, continuity of ownership).
- Transfers where the tax base is below $5,000.
These exemptions are strictly governed. Have your notary confirm your eligibility before the transaction closes.
What is the impact for the seller and the buyer of a property in Montréal?
The transfer duty is paid by the buyer but affects the seller indirectly:
- For the buyer: on a $2,000,000 property, roughly $39,800 in transfer duties must be provisioned at closing, on top of notary fees and adjustments. This is a real "entry cost" to include in any yield analysis. Use the purchase offer calculator to model all costs.
- For the seller: a well-informed buyer factors acquisition costs into the price offered. Know your net proceeds, support your price with the property's actual income, and see our page on selling an income property in Montréal for the full process.
In summary
Montréal's 7-tier welcome tax scale rises from 0.5% to 4.0%, but the highest rates apply only on very large transactions (above $2.1M–$3.1M). For a typical $1.5–2M multiplex the effective rate is lower than in many suburbs. The buyer pays the duty; the seller should know the number to understand the buyer's logic. Property taxes for 6+ unit buildings run about $0.46/$100 in 2026. Confirm all figures with the City of Montréal and your notary. Selling in Montréal? See our direct purchase options.
