GST NEW HOUSING REBATE
You may be eligible to claim a rebate for a part of the GST you pay on the purchase price or cost of building your home if:
- You buy a new or substantially renovated home (including the land or if you lease the land) from a builder.
- You buy a new mobile home (including a modular home) or a floating home from a builder or vendor
- You buy a share of capital stock of a co-operative housing corporation.
- You construct or substantially renovate your own home, or carry out a major addition (or hire another person to do so).
- Your home is destroyed in a fire and is subsequently rebuilt.
- Resale homes are exempt from the 7% GST.
- New homes are subject to the 7% GST. New home buyers can apply for a 2.52 % rebate of the 7% GST applicable to the purchase price to a maximum of $8,750 for homes costing less than $350,000 before GST.
- For new homes priced between $350,000 and $450,000 before GST, the GST rebate would be reduced proportionately.
- New homes priced $450,000 before GST or higher would not receive a rebate.
- The maximum amortization period is 25 years.
- Borrowers are required to demonstrate, at the time of application, their ability to cover closing costs equal to at least 1.5% of the purchase price.
- Where the minimum equity requirement is being met by way of a financial gift, the funds must be in possession of the borrower
90 days before making an offer to purchase.
NOTE: In the Greater Toronto Area, most builders include the GST in the price of the house, and any rebate would be assignable to the builder as they would be absorbing the net GST cost.
For additional questions on the GST rebate program, call Revenue Canada's toll-free-enquiry service at 1-800-565-9353 or contact your Revenue Canada tax services office listed in the blue pages of your telephone book.