Important: If you are buying a newly constructed home, substantially renovated home, or building your own home in Ontario, you may be eligible for the HST new housing rebate. This can save you thousands of dollars. Use our closing costs calculator to estimate all your buying costs.
What Is the HST New Housing Rebate?
The Harmonized Sales Tax (HST) new housing rebate allows buyers of newly built homes in Ontario to recover some of the HST paid on the purchase. The HST in Ontario is 13%, consisting of a 5% federal portion (GST) and an 8% provincial portion (PST).
There are two components to the rebate:
- Federal (GST) New Housing Rebate — Rebate on the 5% GST portion
- Ontario New Housing Rebate — Rebate on the 8% provincial portion
Who Qualifies for the HST New Housing Rebate?
You may qualify for the HST new housing rebate if you:
- Purchased a newly constructed home from a builder
- Built or substantially renovated your own home
- Purchased a new home on leased land
- Converted a non-residential property to residential use
- Purchased a mobile or modular home
Key Eligibility Requirements
- The home must be your primary place of residence (or a relation's)
- You must be an individual (not a corporation)
- You must apply within the required time frame (generally 2 years from closing)
How Much Is the HST New Housing Rebate?
Federal (GST) New Housing Rebate
| Home Price | Rebate Amount |
|---|---|
| Up to $350,000 | 36% of GST paid (maximum $6,300) |
| $350,000 to $450,000 | Gradually reduced (clawed back) |
| Over $450,000 | No federal rebate available |
Ontario Provincial New Housing Rebate
| Home Price | Rebate Amount |
|---|---|
| Any price | 75% of provincial HST paid, up to a maximum of $24,000 |
Maximum Combined Rebate
The maximum combined HST new housing rebate (federal + provincial) is $30,300 ($6,300 federal + $24,000 Ontario). Note: for homes over $450,000, only the Ontario portion applies.
HST New Housing Rebate Examples
| Purchase Price | Total HST (13%) | Federal Rebate | Ontario Rebate | Total Rebate |
|---|---|---|---|---|
| $300,000 | $39,000 | $5,400 | $18,000 | $23,400 |
| $400,000 | $52,000 | $3,150* | $24,000 | $27,150 |
| $500,000 | $65,000 | $0 | $24,000 | $24,000 |
| $700,000 | $91,000 | $0 | $24,000 | $24,000 |
* Federal rebate is partially clawed back between $350,000 and $450,000.
How to Apply for the HST New Housing Rebate
- Builder-assigned rebate: In most cases, the builder assigns the rebate to themselves and reduces your purchase price accordingly. This is the most common method.
- Self-application: If the builder did not assign the rebate, you can apply directly to the CRA using Form GST190 (federal) and Form RC7190-ON (Ontario).
- Owner-built homes: If you built your own home, apply directly to the CRA after the home is substantially complete.
Application Deadline
You must apply within 2 years of the completion or purchase of the home. Missing this deadline means losing the rebate entirely.
HST on Substantially Renovated Homes
If you substantially renovated an existing home (defined as 90% or more of the interior being removed or replaced), you may also qualify for the HST new housing rebate. This applies when:
- The renovation is so extensive that the result is essentially a new home
- The home is your primary place of residence
- You apply within the required timeframe
Frequently Asked Questions
No. Resale homes are generally exempt from HST. The HST new housing rebate only applies to newly constructed homes, substantially renovated homes, and owner-built homes.
The new housing rebate requires the home to be a primary residence. However, there is a separate New Residential Rental Property Rebate for properties purchased as rental investments.
Often yes. Many builders advertise prices that already include the HST rebate assignment. Check your agreement of purchase and sale carefully to understand whether the rebate has been assigned to the builder.
Need Help Understanding the HST Rebate?
Lacerda Real Estate helps buyers navigate the HST new housing rebate and other financial aspects of buying a new home in Mississauga. See our First-Time Home Buyer Guide for a complete overview. Contact us for expert guidance.