HST new housing rebate신축 주택 HST 환급

What is it?

When you buy a newly built home or a pre-construction condo from a builder, HST is charged on the price. Ontario’s HST is 13%: the 5% federal GST plus an 8% Ontario part. That is a big tax compared with buying a resale home.

The "new housing rebate" gives part of that HST back when you or a family member will live in the home. It has a federal part (a rebate of the 5% GST) and an Ontario part (a rebate of the 8%), and the two are calculated differently. The CRA (Canada Revenue Agency) handles both.

This page is about new homes sold by a builder, where HST applies. Check your contract and ask your lawyer whether HST applies to the home you are buying.

The federal part (rebate of the 5% GST)

Under s. 254(2) of the Excise Tax Act, the rebate is 36% of the GST you paid, up to $6,300. You get the full amount if the price (the "total consideration") is $350,000 or less. Between $350,000 and $450,000 it shrinks, and at $450,000 it is $0. Most new homes in Toronto and the GTA cost more than $450,000, so most buyers get nothing from this basic federal rebate.

Conditions: when you sign the agreement, you must be buying the home as the primary place of residence of yourself or a "relation" (a related person as defined in the Act, including a former spouse), and the first person to live in the home after it is substantially completed must be you or that relation. You must apply within two years after ownership is transferred to you (s. 254(3)).

The Ontario part (rebate of the 8%)

Under s. 41(2) of the federal regulations (SOR/2010-151), the Ontario rebate is 75% of the 8% provincial part you paid, up to $24,000. Unlike the federal part, you still get it when the price is over $450,000. Since 75% of 8% is 6% of the price, the rebate reaches $24,000 at a price of $400,000, and every home above that gets $24,000.

The conditions are the same as for the federal part (primary residence of you or a relation, first to live in it). The deadline is also two years after ownership is transferred (s. 41(4)).

For reference only, calculated with the formulas in the Act ($400,000: 36% of $20,000 GST = $7,200, capped at $6,300, then multiplied by ($450,000 − $400,000 = $50,000) ÷ $100,000 = 50%, giving $3,150). The first-time buyer rebates are not included.

Extra rebates for first-time home buyers (agreements after March 19, 2025)

A 2026 amendment to the Excise Tax Act added much larger rebates for first-time home buyers (s. 254(2.1)). They appear as in-force text in the laws-lois consolidation I read on October 30, 2026.

• Federal: if the price is $1,000,000 or less, you get back all of the GST you paid, up to $50,000. Between $1,000,000 and $1,500,000 it shrinks, and at $1,500,000 it is $0. Any basic federal rebate you received is subtracted.
• Ontario: on the same conditions there is an extra Ontario rebate (SOR/2010-151, s. 41(2.1)). If the price is $1,000,000 or less, together with the basic $24,000 rebate it returns all of the 8% you paid, up to $80,000. Above $1,000,000 the extra amount shrinks, and by the regulation’s formula it reaches zero at a price of $1,350,000. The total of all Ontario rebates is capped at $80,000 (s. 41(2.2)).
• Conditions: the agreement of purchase and sale is signed after March 19, 2025 and before 2031, construction starts before 2031 and is substantially completed before 2036, ownership is transferred to you before 2036, you buy the home as your own primary residence and are the first to live in it, and you are a "first-time home buyer" when ownership is transferred to you.
• A "first-time home buyer" (s. 123(1)) is a person who is 18 or older, a Canadian citizen or permanent resident, and who has not lived, as their primary residence, in a home owned by themselves or their spouse (in or outside Canada) in this calendar year or the four before it.
• You can get it only once. If you or your spouse already received one of these rebates after March 19, 2025, you cannot get another (s. 263.3).

Separately, for homes with an agreement signed with the builder from April 2026 to March 2027 (price under $1,850,000), a temporary rule gives an extra Ontario rebate even if you are not a first-time buyer (SOR/2010-151, s. 41(2.01)). You must qualify for the basic Ontario rebate (primary residence of you or a relation), construction must start before 2029 and be substantially completed before 2032, and the HST must become payable before 2033. Up to a price of $1,500,000, together with the basic rebate (up to $24,000) it returns all of the 8% you paid, up to $80,000 in total. Between $1,500,000 and $1,850,000 the extra amount shrinks. These rules are new, so confirm the details and how to apply with the CRA and your lawyer.

How builders put it in the price

The law lets the builder claim the rebate for you and pay or credit it against the price (s. 254(4)). That is why GTA pre-construction prices are commonly advertised as "HST included, rebate assigned to the builder". It means the price already assumes you qualify and already has the rebate taken off.

If you do not qualify (for example, you will rent the unit out instead of living in it), you must pay the builder the rebate amount at closing. The Ontario part alone can be $24,000, so read the HST clause in the contract before you sign. The amount shows up on your closing statement of adjustments.

If a builder credits the rebate to someone who does not qualify, the builder and the buyer are jointly liable to repay the CRA (s. 254(6)). Be honest about your plans.

Buying to rent out (the rental rebate)

If you buy to rent the home out rather than live in it, you cannot get the new housing rebate above. Instead there is the "new residential rental property rebate" (Excise Tax Act, s. 256.2). The federal part works the same way: 36% of the GST, up to $6,300. A condition is that a tenant lives there as their primary residence for at least one year.

A builder cannot credit this rebate in the price. You pay the full HST at closing and then apply to the CRA yourself, with the lease attached. I could not read the Ontario rental rebate rules while writing this page, so confirm them with the CRA and an accountant.

Assignments and HST

Selling your purchase agreement with a builder to someone else before the home is finished (an assignment) also attracts HST. Section 192.1 of the Excise Tax Act treats the assignment as a taxable sale. If the assignment agreement says in writing that part of the price repays the original deposit, that part is left out of the taxable amount.

Whether the person buying by assignment can claim the rebate, and how the assignor’s profit is taxed (see the residential property flipping rule), is complicated. Talk to a tax professional before you sign an assignment.

Example

A new condo in Vaughan priced at $700,000 before HST, bought to live in. HST at 13% is $91,000 (GST $35,000 plus the Ontario part $56,000).

For reference only. If the agreement with the builder is signed from April 2026 to March 2027, a buyer who is not a first-time buyer also gets an Ontario rebate of $56,000 (an extra $32,000) under s. 41(2.01), so the HST you actually pay is $35,000 (if the other conditions, such as the construction dates, are also met). If the builder’s advertised price is "HST included", these numbers are already built into the price, and if you do not qualify you pay the rebate amount at closing. The first-time buyer rebates and this temporary rebate are new, so confirm the real amounts and the application with the CRA and your lawyer.