As a first-time buyer, owning a home can be financially challenging. There are a few incentives though, from both provincial and federal governments that can make buying a house a bit easier if you’re a first-time buyer.
First-Time Home Buyers’ Tax Credit (HBTC)
The HBTC allows homebuyers to receive a one-time $1,500 tax deduction when claiming up to $10,000 of their eligible house purchase. If you owe tax, the HBTC will deduct $1,500 from what you owe. But if you don’t owe taxes, the HBTC won’t be applied.
Note that you can split the amount with your partner, but the combined claim must not exceed $10,000. To claim this rebate, only one of you or your partner must meet the eligibility criteria below.
HBTC eligibility criteria and making a claim
To claim the HBTC, you (or your partner) must:
- Buy a qualifying home registered in your (or your partner’s) name. This can be an existing property or under construction. Qualifying homes include: single-family houses; townhomes; semi-detached houses; apartments; condo units; mobile homes.
- Be a first-time buyer. This means you did not reside in a property that you or your partner owned in the last four years. If you have a disability, you do not need to meet this criteria.
- The house must become your principal residence within one year once it’s bought or built.
If you meet the eligibility criteria, claiming the HBTC is quite simple. When submitting your taxes for the year in which you bought your first house, enter the Home Buyer’s Amount of $10,000. This will be line 31270 of your income tax return.
GST/HST Housing Rebate
This tax rebate helps homeowners to recover a portion of the GST/HST paid towards their house purchase. As sales tax varies across provinces, the housing rebate calculation differs as seen in the table below:
| Province | Tax rebate |
| Alberta | 36% GST rebate |
| British Columbia | 36% GST rebate |
| Manitoba | 36% GST rebate |
| New Brunswick | 5% of the GST portion of HST can be rebated. 36% of the GST rebate |
| Newfoundland and Labrador | 5% of the GST portion of HST can be rebated. 36% of the GST rebate |
| Northwest Territories | 5% of the GST can be rebated. 36% of the GST rebate |
| Nova Scotia | 5% of the GST portion of HST can be rebated. 36% of the GST rebate. Provincial part of HST may also be rebated |
| Nunavut | 5% of the GST can be rebated. 36% of the GST rebate |
| Ontario | 5% of the GST portion of HST can be rebated. 36% of the GST rebate. Provincial part of HST may also be rebated |
| Prince Edward Island | 5% of the GST portion of HST can be rebated. 36% of the GST rebate |
| Quebec | 5% of the GST can be rebated. 36% of the GST rebate |
| Saskatchewan | 5% of the GST can be rebated. 36% of the GST rebate |
| Yukon | 5% of the GST can be rebated. 36% of the GST rebate |
Rebate eligibility criteria and making a claim
You must meet the following criteria to be eligible:
- The house will be yours or your relative’s primary residence.
- You own the house as an individual. It cannot be owned through, or co-owned with a corporation or partnership.
- The house’s fair market value (including it’s land) does not exceed $450,000
- The house meets the definition of “new housing”:
- Bought from a builder registered in the new housing rebate program
- Built by the owner that’s never been occupied before
- A substantially renovated house (over 90% of its interior)
- Unit owned through buying shares in a cooperative housing corporation
If you are eligible, you must complete two forms: GST191-WS and GST191. These forms can be found on the Government of Canada website.
The forms must be submitted within two years of the house being constructed/renovated, or ownership transferred to you. The earliest date of the two is taken for the two year time period.
Note if buying a house from a builder, they may choose to apply for the rebate. If so, they will complete the forms and send you the rebate once it’s received.
Provincial assistance
Some provinces offer additional assistance to help make houses more affordable too. As an example, British Columbia and Ontario offer a land transfer tax refund. It’s worth checking with your municipal government to understand what assistance may be available to you.