Buying a home is one of the biggest steps most of us take in life. But with big steps come big bills — and those taxes? Ouch. That’s where the GST rebate on new homes comes in.
If you’ve been scratching your head wondering what that even means, you’re in the right place.
When I bought my first home, I had no clue I could get money back from the government. Turns out, there’s a rebate that can save you thousands. It’s called the GST/HST New Housing Rebate.
In this post, I’ll explain what it is, who can get it, how much you might receive, and how to apply.
Let me explain it in simple terms so it’s easy to understand. By the end, you’ll know exactly what steps to take next.
What is the GST New Housing Rebate?
So, first things first. What is this rebate?
When you buy a new home in Canada, you usually pay the Goods and Services Tax (GST) or the Harmonized Sales Tax (HST), depending on your province. That tax adds thousands to your purchase price.
The New Housing Rebate (NHR) gives you back a part of that tax. It’s a refund offered by the Canada Revenue Agency (CRA) to help make homeownership a little more affordable.
GST vs HST: What’s the difference?
| Feature | GST (Goods and Services Tax) | HST (Harmonized Sales Tax) |
| Definition | A federal tax charged on most goods and services in Canada | A combined tax that merges federal GST and provincial sales tax (PST) |
| Who Charges It | Federal government | Federal and participating provincial governments |
| Rate | 5% (across Canada) | Varies by province (e.g., 13% in Ontario, 15% in Nova Scotia) |
| Applies In | All provinces and territories | Only in provinces that have adopted HST (e.g., Ontario, Nova Scotia, New Brunswick, etc.) |
| Tax Breakdown | Single 5% federal portion | Includes 5% federal + additional provincial portion |
| Collected By | Canada Revenue Agency (CRA) | Canada Revenue Agency (CRA) |
| Purpose | Federal revenue | Simplify tax collection by combining GST and PST |
| Provinces Using It | All provinces (for GST) | Ontario, Nova Scotia, Newfoundland and Labrador, New Brunswick, and PEI |
Depending on where you live, you might be eligible for a federal rebate (GST) and a provincial rebate (HST portion). But not all provinces offer both.
So why does this matter to you as a buyer?
Because you could get thousands of dollars back after buying your home. And if you’re working with a builder, sometimes this rebate is already included in the price — but more on that later.
Who is Eligible for the GST New Housing Rebate?
If you’re buying a new home in Canada, you might be asking: who is eligible for the GST new housing rebate? This rebate helps reduce the amount of Goods and Services Tax (GST) you pay on a new or substantially renovated home.
To qualify, the home must be your primary place of residence. That means you or a close family member must live there.
The GST rebate for new homes is available if the home costs less than $450,000. Homes priced under $350,000 may be eligible for the full rebate, while those between $350,000 and $450,000 may qualify for a partial rebate.
You can also claim the rebate if the home is:
- Newly built (home or condo)
- Substantially renovated
- Built by you as an owner
It doesn’t matter if you’re a first-time buyer or not. But if you are, you may also qualify for the first home buyer GST rebate or other first-time buyer programs like the FHSA (First Home Savings Account) or HBP (Home Buyers’ Plan).
Who Is Not Eligible?
You won’t qualify if:
- You’re buying the home as an investment or rental property
- The home is for commercial use
- You’re buying the home from a close relative, like a parent or sibling
Still unsure? A licensed real estate agent can help you understand the rules and whether you meet the criteria.
How Much GST Rebate Can You Get?
When it comes to the GST rebate for new homes, the big question is: how much can you actually get back?
Let’s break it down in simple terms.
If you qualify for the GST rebate on new homes, you could get back up to 36% of the 5% GST you paid on the purchase price. The maximum amount you can receive is $6,300, but that only applies if your home costs $350,000 or less.
For homes priced between $350,000 and $450,000, the Canada new home GST rebate is gradually reduced. If your home costs over $450,000, you unfortunately won’t qualify for any rebate.
Example:
Say you buy a brand-new condo for $400,000.
- GST: $400,000 × 5% = $20,000
- Rebate potential: 36% of $20,000 = $7,200
But since your home is over $350,000, the rebate is lowered. You might end up with about $3,150 instead.
What About Provincial Rebates?
Some provinces offer HST rebates in addition to the federal GST rebate:
- Ontario gives a separate provincial new housing rebate
- Nova Scotia has stricter limits and lower maximums
- New Brunswick, Newfoundland and Labrador, and PEI offer their own combined rebates too
Each province has different rules, so it’s a good idea to check with the CRA or your provincial tax authority for full details.
Want to know where your rebate can go the furthest? Check out the best cities to invest in real estate in Canada!
How to Apply for the GST New Housing Rebate?
If you’ve bought a new home, you might be wondering how to apply for the GST new housing rebate. The good news? There are two simple ways to go about it.
Option 1: The Builder Applies for You
In most cases, the home builder includes the rebate in the purchase price. This means the rebate is already factored into the amount you pay. You don’t need to do anything.
Instead, the builder claims the rebate directly from the CRA and passes the savings on to you.
To be sure, check your purchase or sale agreement. It will usually state whether the rebate has been included in the final price.
Option 2: Apply Yourself Using CRA Form GST190
If your builder didn’t apply on your behalf, don’t worry. You can apply directly through the Canada Revenue Agency (CRA).
Here’s what to do:
- Go to the CRA website and download Form GST190.
- Fill it out carefully.
- Gather the required documents, including:
- The signed purchase agreement
- Proof of payment
- Statement of adjustments
- A utility bill or other proof that you live there
- The signed purchase agreement
Next, mail the form and documents to the CRA office listed on the form.
The CRA usually processes rebate applications in 6 to 8 weeks. During that time, you can check your status through CRA MyAccount.
Applying is easy when you follow the steps—and the rebate can save you thousands.
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Know Deadlines & Important Dates for the New GST Rebate
When it comes to claiming the new GST rebate, timing is everything. If you miss the deadline, you could lose your chance to save thousands of dollars. That’s why it’s important to know the key dates.
You must apply for the GST rebate for new homes within 2 years. But what does that mean exactly?
It depends on your situation:
- If you bought a new home from a builder, your deadline is 2 years from the date of possession (when you take ownership).
- If you built or substantially renovated the home yourself, you have 2 years from the date construction is completed.
So, it’s not just 2 years from when you sign the purchase agreement. Instead, it’s based on when the home is ready and livable.
For example, if you move into a new home on June 1, 2024, you have until June 1, 2026 to submit your rebate application.
If you’re building your own home, the clock starts once the project is finished and you move in.
Missing this window means you’ll no longer be eligible for the rebate. That could cost you up to $6,300 in lost savings.
So, mark the date and set reminders. The GST rebate on new homes is a valuable benefit—but only if you apply in time.
When it comes to the new GST rebate, timing matters. Missing the deadline could cost you thousands. Learn key dates and how real estate agent rules may affect your eligibility.
Need help remembering? Many people use CRA MyAccount to track dates and manage their application.
Avoid These Issues to Get Your Rebate Faster
Applying for the GST new housing rebate can save you a lot of money—but only if you do it right. Many people miss out simply because of small mistakes. Let’s help you avoid those costly errors.
1. Missing the 2-Year Deadline
One of the biggest mistakes is waiting too long to apply. You must submit your application within two years of buying your home or completing construction. If you miss this deadline, you won’t get the rebate—no exceptions. So, it’s best to apply as soon as possible.
2. Claiming for Rental Properties
Another common error is trying to claim the rebate for a home you’re renting out. Remember, this rebate is only for your primary place of residence. If the home is an investment or rental property, it doesn’t qualify for the GST rebate.
3. Not Keeping Proper Documents
The CRA needs proof to process your claim. This includes your purchase agreement, proof of payment, statement of adjustments, and proof that you live in the home (like a utility bill). If you can’t provide these, your application might be delayed or denied.
Helpful Tip:
From the moment you buy your home, start a folder for all important documents. Keep everything in one place—digital or physical. This small step can save you a lot of time and stress later.
Avoiding these simple mistakes means a smoother process—and more money back in your pocket.
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GST Rebate for First-Time Home Buyers
You might be wondering if there’s a special GST rebate for first-time home buyers. The answer is simple: you don’t need to be a first-time buyer to get the GST rebate for new homes. However, if this is your first home, there are a few extra perks you should know about.
Extra Benefits for First-Time Buyers
First-time buyers can combine the GST rebate for new homes with other helpful programs. This can make a big difference when you’re trying to save money and manage costs.
Here are two great options to explore:
- First Home Savings Account (FHSA): This is a tax-free savings account designed to help first-time buyers save for a home faster. Contributions are tax-deductible, and withdrawals for a home purchase are tax-free.
- Home Buyers’ Plan (HBP): This program lets you withdraw up to $60,000 from your RRSP to use toward your first home. You pay it back over time without interest.
By using these tools together, you can lower your upfront costs and make homeownership more affordable.
Just remember, whether it’s your first home or not, you still need to meet the basic rules to qualify for the GST rebate for new homes. That means the home must be your primary residence and cost under $450,000 to get the full benefit.
Want more guidance? Check out our helpful guide on how to get a real estate license in Ontario to better understand the market and make smart buying choices.
FAQs on GST Rebate for New Homes
1. Can I get a GST rebate on a resale home?
No, resale homes do not qualify. The GST rebate for new homes only applies to newly built or majorly renovated homes that meet CRA eligibility rules.
2. What if my builder didn’t apply for the rebate?
If your builder didn’t apply on your behalf, you can still claim the rebate. Just fill out Form GST190 and mail it to the CRA with all required documents.
3. Do I pay GST on a new home in Canada?
Yes, you must pay GST or HST on all newly built homes. This applies whether you buy from a builder or build the home yourself. The rebate helps offset the cost.
4. Is the GST rebate taxable income?
No, the GST rebate is not taxable income. It’s a refund from the government. You don’t need to include it on your tax return or pay taxes on it.
5. What if I move out within a year?
The home must be your primary residence for at least one year. If you move out too soon, the CRA may ask you to repay the GST rebate you received.
Conclusion
Buying a new home comes with a lot of expenses—mortgage payments, legal fees, moving costs, and everything in between. That’s why the GST rebate on new homes is such a big deal. It’s one of the few chances you get to actually claim some money back just for moving into a home you plan to live in.
The best part? You don’t have to be a first-time buyer. As long as the home is new or substantially renovated and it’s going to be your primary residence, you could qualify for a rebate. That’s real savings—up to $6,300 back in your pocket.
But here’s the catch: a lot of people miss out simply because they didn’t know the rules or forgot to apply in time. The Canada Revenue Agency gives you two years to file your rebate claim after you buy or finish building the home.
So, if your new place qualifies, don’t let that money slip away. Check the eligibility, gather your documents, and submit your application before the deadline. It’s a small effort that could lead to big savings.
And if your builder already included the rebate in the purchase price? Even better—you’ve already received the benefit without lifting a finger. But if not, applying yourself is doable.
When you’re spending so much to settle into a new home, every dollar counts. So don’t leave this rebate on the table. You’ve earned it—now go get it!
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