GST/HST New Housing Rebate for First-Time Homebuyers in Canada

Buying or building a new construction home in Canada is a big milestone, but it often comes with an equally big tax bill. Fortunately, there’s a little-known rebate that could help put thousands of dollars back in your pocket: the GST/HST New Housing Rebate.

If you’re wondering how much you can save, who qualifies, or how to avoid paying more HST than you should, keep reading. As a mortgage broker based in Halifax, Nova Scotia, I work with clients across Canada every day to make the most of the programs like this one.

What Is the GST/HST New Housing Rebate?

The GST/HST New Housing Rebate is like a financial pat on the back from the government for taking the leap into homeownership. It’s designed to help first-time homebuyers recover a portion of the GST or HST paid on the purchase of a new or substantially renovated home. This rebate can apply to buying a new home, building one, or undertaking major renovations on an existing home.

How Much Can You Save with the GST/HST New Housing Rebate?

The federal government offers a rebate of up to 100% on GST up to $450,000 purchase price on:

• Homes purchased from a builder
• Owner-built house

Or if you’re a first time home buyer, the federal government offers a rebate of up to $100 GST up to $1.5 Million purchase price.

Some provinces also offer rebates on the provincial portion of HST, like Ontario, BC, and Quebec for example. Nova Scotia currently does not provide a provincial rebate.

Who Is Eligible for the GST New Housing Rebate in Canada?

Not every buyer qualifies. Here’s who is eligible:

• You bought or built a new home (includes condos, mobile homes, and substantial renovations).
  
• The home is intended to be your primary place of residence (or a close relative’s).
  
• You are an individual, not a corporation or business.
  
• The home is located in Canada.
  
• You paid GST or HST on the purchase or construction.
  

If you’re purchasing the home as a rental or investment property, there’s a different rebate available called the GST/HST New Residential Rental Property Rebate.

Important Details & Limitations of the GST/HST Rebate

While the rebate is a fantastic way to save, there are a few catches:

• Home price limit: No federal rebate if the home costs more than $450,000. For First Time Home Buyers, the FTHB GST/HST rebate will be 100% of the federal part for homes valued up to $1.5 Million.
  
• Time-sensitive: You must apply within 2 years of closing or occupancy.
  
• Renovation rule: If you’re claiming for a renovated home, 90% or more of the interior must be rebuilt.
  
• Use of the home: It must be used as your or a close relative’s primary residence, not just a vacation or rental unit.
  

How to Apply for the GST/HST New Housing Rebate

The CRA has made it relatively straightforward to apply, just be sure to use the correct form.

Step-by-Step Application Process:

1. Purchased from a builder? Use Form GST190
   
2. Built or renovated your own home? Use Form GST191
   
3. Include:
   
   • Proof of payment of GST/HST (e.g., builder’s invoice or closing statement)
     
   • Proof of ownership (title, purchase agreement)
     
   • Proof of occupancy (utility bill, driver’s license address)
     
4. Submit the form:
   
   • By mail to the CRA (address is listed on the form)
     
   • Or submit through your CRA MyAccount if available
     

How a Mortgage Broker Can Help Maximize This Rebate

As a mortgage broker, I help you look at the full financial picture, and that includes making sure you don’t leave money on the table.

Here’s how I help:

• Ensure eligibility is considered in your pre-approval or financing plan.
  
• Reduce upfront costs by estimating your rebate in advance.
  
• Builder agreements that may or may not include the rebate in the home price.
  
• Coordinate with lawyers and accountants for more complex transactions.
  

How to Avoid Paying More HST on New Homes Than You Should

It’s not always possible to “avoid” HST on a new home, but many Canadians end up overpaying because they miss important rebate steps. Here are a few ways to protect your wallet:

• Make sure you qualify before closing on your home. Start your application here
  
• If buying from a builder, ask: “Is the rebate already factored into the price?”
  
• Gather documentation right away. Waiting can delay or disqualify your application.
  
• Work with a mortgage broker or accountant who understands the rebate structure.
  
• Ask questions. The CRA provides support, and so does professionals like me.
  

Common Mistakes Canadians Make When Claiming the Rebate

Here are the top errors I see clients make:

• Missing the 2-year deadline
  
• Not occupying the home as a primary residence
  
• Filing the wrong CRA form
  
• Failing to include GST/HST payment receipts
  
• Assuming the builder’s rebate includes everything
  

It’s always worth double-checking with a professional. If you make a mistake, you may have to repay the rebate or miss out entirely.

Ready to Claim Your Rebate?

The GST/HST New Housing Rebate is a helpful tool to alleviate some of the financial pressures of buying or renovating a home. If you’re feeling a bit unsure about how to navigate this rebate or how it fits into your overall home-buying budget, I’m here to help.

Contact me, and let’s make sure you’re getting every financial advantage you’re entitled to as a new homeowner.

Start your free mortgage application today and get personalized advice! Get started below.

Frequently Asked Questions

Sources

• CRA GST/HST New Housing Rebate Guide
  
• Form GST190 – Rebate for Builder Purchases
  
• Form GST191 – Rebate for Owner-Built Homes