Buying a new home is one of the largest financial commitments many Canadians will ever make, and with new builds, the price tag often includes thousands in sales taxes. The GST/HST/QST New Housing Rebate can help offset some or all of the sales taxes you will pay on a newly built home.

If you’re purchasing a newly constructed home, building your own, or undergoing a significant renovation, you may be eligible for a rebate on the Goods and Services Tax (GST), Harmonized Sales Tax (HST), or the Québec Sales Tax (QST) paid. This program can offer substantial savings, particularly in a market where every dollar counts.

In this guide, we’ll walk you through how the New Housing Rebate works, who qualifies, how much you could get back, and what recent changes mean for first-time home buyers (FTHB) across Canada.

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Key Takeaways

• You may qualify for a rebate of some or all of the GST, HST, or QST paid on a new or substantially renovated home.
• Federal and provincial rebate amounts and thresholds differ depending on the province and purchase price.
• To qualify, the home must be your primary residence or that of a relative.

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What Is the GST/HST/QST New Housing Rebate?

The New Housing Rebate is a federal rebate that helps Canadians offset the GST or federal part of the HST they are required to pay when buying or building a new home. It applies to new builds, substantial renovations, and homes built by owners for personal use.

Buyers in most provinces pay either GST or HST on new homes, while buyers in Quebec pay QST. The rebate allows eligible buyers to recover a portion of these taxes, making homeownership more affordable. Understanding whether your home qualifies and how much you could receive is key to planning your overall homebuying budget.

Eligibility for the Rebate

To qualify, you must be an individual purchasing a new home or substantially renovating an existing home that will be used as your primary residence, either for yourself or a family member. The rules are strict regarding occupancy: the home must be used as a primary residence, which must be evident at the outset of buying, constructing, or substantially renovating a home. 

There can be more than one owner, as long as each is considered an individual. Partnerships and corporations are not eligible to claim the new housing rebate, and individuals will be ineligible if purchasing with a partnership or corporation.

How Much of the Tax Can You Get Back?

The amount refunded depends on several factors, including the tax paid, the property value, and the province in which you’re buying. The maximum rebate you can receive on the federal GST portion is 36% of the GST paid to a maximum of $6,300. 

The amount of the rebate available reduces if the purchase price of the home is between $350,000 and $449,999. Homes with a purchase price of $450,000 or more are not eligible for the rebate. 

Provincial Refunds

Some provinces provide a refund on the provincial portion of the HST paid on new homes. Participating provinces include Nova Scotia and Ontario.   

• Ontario Rebate – The maximum Ontario new housing rebate amount is $24,000 on the provincial portion of the HST. 
• Nova Scotia Rebate – The maximum Nova Scotia First-Time Home Buyers Rebate amount is $3,000. However, eligibility criteria are restricted to first-time homebuyers and do not apply to renovated homes. 

QST Rebate That Applies in Quebec

Quebec’s rebate is distinct from the rest of Canada. Administered through Revenu Québec, it allows for a refund of up to 36% of the GST paid and up to 50% of the QST paid, to a maximum GST rebate of $6,300 and a QST rebate of $9,975. 

The amount of the rebate is reduced when the purchase price of the home or fair market value exceeds $350,000 for GST and $200,000 for QST. Homes valued at $450,000 or more (GST) and $300,000 or more (QST) are not eligible for the rebate. 

How to Apply for the GST/HST/QST Rebate

Homeowners and Homebuyers have up to 2 years after the base date to claim the rebate. Depending on the province, you will complete this process directly through the CRA or Revenu Québec if you meet all eligibility requirements and submit the required documents.

GST Relief for First-Time Home Buyers

The federal government has introduced a proposal to amend the Excise Tax Act and implement a new GST rebate, providing targeted relief for first-time home buyers purchasing newly constructed homes valued at up to $1.5 million. As part of this proposal, the federal government is eliminating the GST for first-time homebuyers on new homes valued up to $1 million and reducing the GST on new homes between $1 million and $1.5 million. The FTHB GST rebate will save first-time buyers up to $50,000 on a new home.  

To qualify:

• You must be considered a first-time buyer. 
• Be a Canadian citizen or a permanent resident of Canada
• Not have lived in a home in or outside of Canada that was owned by you or a spouse/common-law partner in the calendar year or the 4 preceding calendar years.
• Buy a new home from a builder; 
• Build or hire someone to build a home on land you own or lease; or
• Buy shares of a co-operative housing corporation.

Frequently Asked Questions (FAQ) About the New Housing Rebate in Canada

Final Thoughts

The GST/HST/QST New Housing Rebate, along with the newly expanded GST relief for first-time homebuyers, can significantly reduce the upfront tax burden of purchasing a new home in Canada. For buyers of newly constructed homes or substantially renovated homes, understanding your eligibility and ensuring your rebate is claimed on time can help you save thousands in taxes. This rebate can complement your broader mortgage strategy, whether you’re planning for a first home, major renovation, or custom build.

Ready to make the most of every rebate and rate opportunity? Talk to a nesto mortgage expert today to build an innovative, personalized plan for your home financing journey.

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