GST/HST New Housing Rebate: Who Qualifies and How to Claim

When you buy a newly built home in Canada, you pay GST or HST on the purchase. The GST/HST new housing rebate gives back part of it to buyers who will live in the home, and since 2025 a separate first-time buyers’ rebate can give back all of the federal part. The tax and the rebate are among the closing costs that apply only to new construction.

The standard federal rebate is worth up to $6,300. Ontario’s regular provincial rebate adds up to $24,000, but the two peak at different prices, so together they top out near $27,300 (at a $350,000 price). For agreements signed on or after March 20, 2025, eligible first-time home buyers can claim the First-Time Home Buyers’ (FTHB) GST/HST Rebate on top of the standard one, which together can return all of the federal GST (up to $50,000) on a new home valued at $1,000,000 or less, with a reduced rebate up to $1,500,000 (see below). The rules are specific, the eligibility requirements have real teeth, and mistakes made at closing can result in unexpected bills of thousands of dollars.

This guide covers who qualifies, how to work out the rebate in each province, how to claim, and the mistakes that most often cost buyers and investors the rebate.

When GST/HST Applies to a Home Purchase

The first question is whether GST or HST applies to your purchase at all. The rule is straightforward: new construction is taxable; resale from an individual is generally exempt.

Newly constructed homes, substantially renovated homes, and properties converted from non-residential to residential use are all subject to GST or HST. When you buy a brand-new condo pre-construction, a new detached home from a subdivision builder, or a converted commercial loft from a developer, you are paying GST or HST on that transaction. The tax is typically embedded in the purchase price rather than added separately, but it is real and it is substantial.

Resale homes (a used home bought from another individual) are generally exempt from GST/HST. You do not pay GST when you buy from someone who is selling the home they lived in. This is why the rebate does not come into play for the vast majority of real estate transactions in Canada.

Assignment sales, where the original pre-construction buyer sells their rights to the purchase contract before the home is completed, are a grey area that deserves its own section (see below). The tax treatment of assignments has been evolving and CRA scrutiny has increased.

GST vs HST: What Province Are You In?

Which tax you pay depends on the province: Ontario and the four Atlantic provinces charge the harmonized sales tax (HST), which combines the federal GST with a provincial part; the other provinces charge the 5% GST, and Quebec also charges its own QST separately. The rate in each province is on the sales tax by province page.

The distinction matters for the rebate: the federal rebates apply to the GST or the federal part of the HST, while a province with HST or QST may have its own rebate on its part, with different limits and rules.

Federal GST New Housing Rebate

Who qualifies

The federal rebate is available only when you meet every condition CRA sets, including these:

1. The property type qualifies. The home must be newly constructed by a builder, substantially renovated (at least 90% of the interior removed or replaced), or a conversion from non-residential to residential use.

2. Primary residence use. You, or a relation (a parent, child or other descendant, sibling, spouse or common-law partner, or a person connected to your spouse or partner by blood), must intend to occupy the home as a primary place of residence. Vacation homes, investment properties, and rental properties do not qualify for the standard rebate. “Intend to use” is the test: you must have genuine intention at the time of purchase, not simply claim it retrospectively.

3. Buying from a registered GST/HST registrant. You must have bought the home from a builder and paid the GST/HST due on the purchase. Owner-built homes follow different rules (Form GST191 rather than GST190).

4. Price is below $450,000. The federal rebate is nil at a purchase price of $450,000 or more. The rebate phases down between $350,000 and $450,000.

5. Filed within the deadline. For a home bought from a builder, you have up to two years from the date ownership is transferred to you to claim the rebate; owner-built homes use a different base date.

Federal rebate amounts

The federal rebate is 36% of the GST paid on the purchase, subject to a maximum of $6,300. For homes at or under $350,000, the math is simple: multiply the purchase price by 5% (GST) and then by 36%. The result is your rebate, capped at $6,300.

For homes between $350,000 and $450,000, the rebate is phased out using a linear sliding scale. At $450,000 and above, the federal portion is zero.

The sliding scale formula

For any purchase price between $350,000 and $450,000, the federal rebate is:

Rebate = $6,300 × ($450,000 − Purchase Price) ÷ $100,000

Notice that the “purchase price” used in this formula is the price before GST is added. If a builder quotes you a price of $400,000 “plus applicable taxes,” that $400,000 is the pre-tax price for the rebate formula. If the builder quotes $452,000 including HST, you work backward to find the pre-tax price before applying the threshold test.

New for 2025: The First-Time Home Buyers’ (FTHB) GST/HST Rebate

The $450,000 ceiling above is no longer the whole story for first-time buyers. A new federal rebate, the First-Time Home Buyers’ (FTHB) GST/HST Rebate, was introduced for agreements of purchase and sale entered into on or after March 20, 2025, and dramatically raises the price ceiling for eligible buyers.

Combined with the standard GST/HST new housing rebate described above, an eligible first-time buyer can recover all of the GST (or the federal part of the HST), up to $50,000, on a new or substantially renovated home valued at $1,000,000 or less, rather than the standard rebate’s $6,300 at most. The rebate shrinks on a sliding scale above $1,000,000, and none is available at $1,500,000 or more.

The sliding-scale formula between $1 million and $1.5 million is:

FTHB Rebate = min(GST/HST paid, $50,000) × ($1,500,000 − Purchase Price) ÷ $500,000

Who qualifies as a first-time home buyer

To be considered a first-time home buyer for this rebate, you must, at the relevant date (generally when ownership transfers or, for owner-built homes, when you first occupy or construction is substantially completed, whichever is earlier):

• Be at least 18 years old
• Be a Canadian citizen or permanent resident
• Not have lived in a home (in Canada or elsewhere) that you owned as your primary place of residence at any time in the current calendar year or the preceding four calendar years
• If you have a spouse or common-law partner, you also must not have lived in a home they owned as your primary place of residence during the same period

Only one individual can be the claimant on the application, and that individual must be the first-time home buyer. The rebate is not available to corporations or partnerships.

Key dates

If you already separately claimed (or the builder credited you) the standard GST/HST new housing rebate on the same home, that amount is deducted from the FTHB rebate calculation to prevent double-claiming. The FTHB rebate tops up the standard rebate: together they return up to $50,000 of the federal part, and the standard amount already claimed or credited is subtracted so nothing is paid twice.

Ontario’s enhanced new housing rebate

Ontario has a temporary Ontario enhanced new housing rebate (ENHR) that, together with the regular Ontario new housing rebate, gives up to $80,000 of the 8% provincial part of the HST back on a new or substantially renovated home valued up to $1,850,000. It isn’t limited to first-time buyers. It applies when the agreement of purchase and sale with the builder is signed between April 1, 2026 and March 31, 2027, or, for an owner-built home, when construction starts in that period. The full provincial part is rebated on a home valued up to $1,000,000, a flat $80,000 from there up to $1,500,000, a smaller rebate up to $1,850,000, and from $1,850,000 only the regular rebate of up to $24,000 is left.

Provincial New Housing Rebates

In provinces with HST or QST, the provincial part of the tax can have its own rebate on top of the federal one, and the rules differ by province.

Ontario: The Most Significant Provincial Rebate

Ontario’s provincial HST new housing rebate is available at any purchase price, which is the key difference from the federal rebate. Where the federal portion disappears entirely above $450,000, Ontario’s provincial rebate of up to $24,000 applies on homes at any price: $500,000, $800,000, or $1,500,000.

The calculation: 75% of the 8% provincial portion of HST, capped at $24,000. The cap is reached at a purchase price of $400,000 (8% × $400,000 × 75% = $24,000). Above $400,000, the provincial rebate stays at the $24,000 maximum regardless of price.

This means that for a home priced above $450,000 in Ontario, the buyer receives no standard federal rebate (a first-time buyer may qualify for the separate FTHB rebate) but a full $24,000 provincial rebate. On a $700,000 new condo in Toronto, you save $24,000 in provincial HST through the rebate.

The Ontario provincial rebate is typically credited by the builder in the same way as the federal rebate: some Ontario new-home agreements show the purchase price “net of HST rebate,” meaning the rebates the builder credits (up to $24,000 provincial, plus the federal rebate where the price is low enough to qualify) are already included in the stated price.

Other Provincial Rebates

Quebec deserves specific mention. Quebec charges both federal GST and provincial QST (9.975%) separately. Both have their own new housing rebates with parallel structures. The QST rebate is 50% of the QST paid, up to a maximum of $9,975, for homes at or under $200,000. The QST rebate phases out between $200,000 and $300,000 and is zero at $300,000 or more. Combined with the federal GST rebate, a Quebec buyer of a $200,000 home can recover up to $3,600 (federal) + $9,975 (QST) = $13,575. The QST rebate is claimed on Revenu Québec form FP-2190.AC-V (for a new home bought from a builder; other forms cover owner-built homes and leased land or co-op shares).

British Columbia is not an HST province: the GST applies, with the same federal rebate (up to $6,300). BC’s separate newly built home exemption is from its property transfer tax, not from the GST.

How the Rebate Interacts With Your Mortgage

This is a practical detail that many buyers overlook. In Canada, GST/HST on a new home is part of the total cost you finance: the tax is part of the price you pay, so it affects the amount you need at closing or borrow. The rebate then works as follows depending on which claim method you use:

When the builder credits the rebate: The purchase price you sign on is usually “net of rebate”, meaning the builder has already taken the federal rebate (up to $6,300) and, in Ontario, the provincial rebate (up to $24,000) off the final price. You do not see a separate rebate; it is simply embedded in a lower asking price. Your mortgage is based on this lower figure.

When you self-claim: If the builder doesn’t pay or credit the rebate, you file the claim directly with the CRA and wait to receive the rebate. A larger purchase price also means a larger mortgage, and with less than 20% down a larger mortgage insurance premium, which is one reason builder-credited rebates are common.

The Primary Residence Requirement in Practice

“Primary place of residence” sounds straightforward, but CRA examines this condition carefully in audits, particularly for pre-construction condos in high-demand markets where buyers sometimes claim primary residence but later rent the unit or flip it.

What qualifies:

• You or a close relative genuinely intend to move in and use the home as your main home
• A close relative includes your spouse or common-law partner (or a former one), parent, child, grandparent, grandchild, or sibling, and the same blood relatives of your spouse or common-law partner, such as a parent-in-law

What does not qualify:

• Purchasing as a rental investment from day one
• Purchasing for a corporation or business entity
• Planning to rent out and claim it is “temporary” before you move in
• Purchasing a vacation or recreational property (even if you spend significant time there)
• Purchasing for a relative who is not “close” as defined above (e.g., aunts, uncles, cousins, friends)

The flip risk: CRA looks at the circumstances, including whether you treat the house as your main residence and how long you live in it. If you take possession, never move in, and immediately list the unit for rent, CRA can challenge the primary residence claim and require the rebate to be repaid. What the CRA looks at is whether your intent to live in the home as your primary place of residence was evident at the outset of the purchase.

Substantially Renovated Homes: Is There an HST Rebate on Renovations?

Not for an ordinary renovation. A new kitchen, new bathrooms or new flooring in a home you already own don’t qualify on their own, because the renovation has to meet the definition of a substantial renovation. The new housing rebate covers a renovation only when it is so extensive that the CRA treats the house as newly built: a substantial renovation, in which, generally, 90% or more of the interior of the existing house is removed or replaced (the CRA’s 90% test). A major addition qualifies only when the existing house is also substantially renovated; an addition on its own does not. The same rebates then apply as for a newly built house, including the first-time buyers’ rebate for an owner-built home.

Only livable areas count toward the test, including finished basements and finished attics; garages and crawl spaces don’t. You don’t have to replace the foundation, the exterior and interior supporting walls, the roof, the floors or the staircases to pass it. A full gut renovation that strips the interior and rebuilds the walls, insulation, electrical, plumbing, heating, kitchen, bathrooms and flooring would typically qualify. A renovation that updates the kitchen, two bathrooms and the floors while keeping the existing walls, ceilings and wiring would typically not.

A home you substantially renovated yourself uses Form GST191 (owner-built); a substantially renovated home bought from a builder uses GST190, like a new build. If you renovated the home yourself, you generally have two years from the date the work was substantially completed to file; for a renovated home bought from a builder, the two years run from the date ownership was transferred to you. Because the rebate can be worth thousands of dollars, many owners have a GST/HST specialist confirm a renovation meets the test before the work starts.

Assignment Sales and the GST/HST Rebate

Assignment sales, where a pre-construction buyer sells their contract to a new buyer before the home is built, have become a significant issue in Canada’s new housing rebate landscape, particularly in Toronto and Vancouver pre-construction condo markets.

For the assignor (original buyer selling the contract): Since May 7, 2022, an assignment sale of a new or substantially renovated home is taxable for GST/HST, and the tax applies to the amount paid for the assignment (less a deposit reimbursement stated in writing), not only the profit. The tax applies whether or not the original buyer is a GST/HST registrant, on the amount the assignee pays for the assignment rather than only on the profit; the assignor generally collects it from the assignee and remits it to CRA. CRA has been actively auditing assignment sales in hot pre-construction markets.

For the assignee (buyer of the contract): An assignee can be eligible for the new housing rebate under the same list of conditions as a direct purchase, with the price paid for a taxable assignment added to the purchase price in the price test. However, the “purchase price” for rebate threshold purposes may include the assignment fee paid to the original buyer, which can push the effective price above $450,000 and eliminate the federal rebate.

Assignment transactions are complex and the tax treatment depends on the specifics of how the agreement is structured and what CRA considers the “cost” of the home. Buyers of assignments often have the agreement reviewed by a lawyer with pre-construction experience and a tax accountant before signing; what a real estate lawyer does covers the lawyer’s part of a purchase.

How to Claim the Rebate

Method 1: Through the builder (standard for new builds)

Most builders include the rebate in the purchase price. This is the most common approach for condominium and new home builders, and it simplifies the process significantly for buyers.

When you sign the purchase agreement, the builder has you complete and sign Form GST190, the rebate application, so the builder can credit the rebate to you and claim it from the CRA. The builder credits the rebate against the price (or pays it to you) and then sends your application to the CRA to recover that amount. When the builder credits it, the rebate comes to you as a lower purchase price rather than a separate payment from the CRA.

The key risk: if you assign the rebate to the builder but you do not actually qualify (because you are buying for investment, not primary residence), the builder will charge back the rebate amount at closing. The builder has to confirm your intended use before crediting the rebate, which is why builders ask how you intend to use the property before you sign.

Method 2: Self-claim (when the builder does not credit the rebate)

If the builder did not credit the rebate in the purchase price, or if you built or substantially renovated the home yourself, you self-claim directly with CRA:

1. Download Form GST190 from the CRA website (or Form GST191 for a home you built or substantially renovated yourself)
2. Gather supporting documents: a copy of your statement of adjustments to send with Form GST190 (an owner-built claim sends Form GST191-WS and any invoices without GST/HST instead), and the purchase agreement and other records to keep for six years
3. Complete and sign the form. the form includes the rebate calculation and your certification of eligibility
4. Mail to the CRA tax centre for the property’s location (the Sudbury Tax Centre or the Prince Edward Island Tax Centre; the addresses are in the CRA guide) or submit through your CRA My Account
5. Wait for processing. CRA says all claims are subject to audit, which can add up to six months to the wait on an owner-built claim. CRA mails a rebate cheque to the address on file or deposits directly if you have direct deposit set up

For a home bought from a builder, you have two years from the date ownership was transferred to you to file; for an owner-built home, the two years run from a base date that is generally when the work was substantially completed. Missing this deadline generally forfeits the rebate; the CRA considers late owner-built claims only in extraordinary circumstances, and not for a home bought from a builder.

Common Mistakes That Cost Buyers Money

Rebate errors tend to be costly. Common mistakes to avoid:

1. Assuming the builder credited the rebate without verifying. Check your purchase agreement carefully. Look for language like “purchase price net of HST rebate” or “purchaser assigns GST/HST rebate to vendor.” If this language is absent, the rebate may not have been credited.

2. Buying as an investment but intending to claim primary residence. If you plan to rent the unit rather than live in it, you do not qualify for the standard rebate. Use the rental property rebate (Form GST524) instead: it provides a similar benefit without the primary residence requirement.

3. Missing the two-year filing deadline. For a home bought from a builder the clock starts when ownership is transferred to you; for an owner-built home it starts from a base date that is generally when the work was substantially completed. For a self-claim on a home bought from a builder, the rebate is not paid unless you file within two years after ownership is transferred to you.

4. Confusing the “price” threshold for the rebate. The $350,000/$450,000 thresholds apply to the purchase price before GST/HST, not the all-in price with tax included. This matters for edge cases near the threshold.

5. Assuming a resale home qualifies. Resale purchases of owner-occupied homes from individuals who are not builders are usually GST/HST-exempt, so no rebate applies because no GST/HST was paid.

6. Assuming a gut renovation qualifies without meeting the 90% test. CRA can and does audit renovation claims. If the renovation does not actually meet the 90% interior removal standard, CRA can deny the rebate, and a rebate already paid to someone not entitled to it has to be repaid.

7. Double-claiming when the builder already credited the rebate. If the builder assigned the rebate to themselves and reduced your purchase price, you may not file another new housing rebate application directly with the CRA for the same house.

8. Ignoring the provincial rebate. Ontario buyers purchasing above $450,000 sometimes incorrectly assume there is no rebate at all. The federal portion disappears above $450,000, but the Ontario provincial rebate (up to $24,000) can still be available above that price when its other conditions are met.

GST/HST Rebate for New Rental Properties

Investors buying new homes as long-term rental properties do not qualify for the standard new housing rebate, but there is a separate rebate for them. The New Residential Rental Property (NRRP) Rebate provides equivalent federal and provincial relief for landlords:

• Federal component: 36% of GST paid, maximum $6,300, the same as the standard rebate
• Ontario provincial component: 75% of provincial HST, maximum $24,000, the same as the standard rebate
• Filing form: GST524, with Form RC7524-ON (GST524 Ontario Rebate Schedule) for the Ontario part
• Key requirement: Each unit must be held for long-term residential rental, with its first use as a tenant’s main home under one or more leases for at least one year.
• Filing deadline (purchaser/landlord): Two years after the end of the month in which the GST/HST first became payable on the purchase

If you are buying a new condo as an investment in Ontario, you can recover up to about $27,300 in combined federal and provincial HST (at a price of $350,000; less above that), provided its first use is as a tenant’s main home under a lease of at least one year.

Quick Eligibility Summary

The rebate is one part of what a new home costs to close on; the closing cost calculator estimates the rest, and what closing costs include explains each item. The provincial and federal programs for first-time buyers are gathered in the first-time home buyer guide.