Tax Relief Coming for Some First-time Buyers

The Ontario government has announced plans to rebate the full 8% provincial portion of the HST for first-time buyers on newly built or substantially renovated homes valued up to $1 million.

This would save qualifying first-time home purchasers up to $80,000.

When combined with the federal government’s proposed removal of its 5% portion of the HST, total savings for first-time homebuyers would equal up to $130,000 off the cost of a new home.

Ontario’s rebate would work in tandem with its existing HST New Housing Rebate, which already provides relief of up to $24,000 to eligible purchasers.

For homes valued between $1 million and $1.5 million, the new rebate would be gradually reduced as the price of a new home increases, tapering to a minimum of $24,000.

To take advantage of the new rebate, an Agreement of Purchase and Sale must be signed on or after May 27, 2025, and before 2031.

Construction of the home, to be used as the first-time buyer’s primary residence, must begin before 2031, and the home must be substantially completed before 2036.