14B Harbour St
Toronto, ON, M5J 2Y4
New HST Rebate Guide
A Comprehensive Breakdown of Federal & Provincial Changes
New Federal FTHB GST Rebate
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Fed Govt has approved Bill C-4 to exempt GST on new homes for First-Time Home Buyers (FTHB):
- Eliminate 5% GST on new builds for qualifying homebuyers valued at $1M or less.
- Portion of 5% GST on new builds between $1M and $1.5M (sliding scale).
- No rebate above $1.5M.
- This represents a savings of up to $50,000 on the purchase price!
- Will apply for agreements entered on or after March 20, 2025 to the end of 2030.
- Construction must begin before 2031 and be substantially completed before 2036.
Reminder: Strictly limited to FTHB
Disclaimer: This guide is for informational purposes only and does not constitute financial, legal, or tax advice. Government programs are subject to change. Consult a real estate lawyer or tax professional regarding your specific situation before signing any real estate contracts.
Fed. FTHB Eligibility Criteria
- Buyer is 18+ and a Canadian citizen or permanent resident.
- Buyer must be a FTHB (or not have lived in a home that they/ their spouse/common-law partner owned or jointly owned in the last 5 years).
- Possible for parents to co-sign APS with adult children and maintain eligibility – as long as one party is FTHB.
- Home must be the primary place of residence.
- FTHB must be the first occupant.
- Buyer cannot have previously applied for a FTHB GST/HST rebate.
Proposed Provincial FTHB PST Rebate
- October 2025 the Province announced their intention to mirror the Federal FTHB GST Rebate once passed into law (which occurred March 12th, 2026);
- As of today, not yet finalized;
- Together with Ontario’s existing HST New Housing Rebate, the new Ontario rebate would provide relief of:
- The full 8% PST for FTHB up to $1M (up to $80k);
- Portion of 8% HST on new builds between $1M and $1.5M (sliding scale);
- Existing $24,000 for $1.35M to $1.5M
- Will have same eligibility conditions as Federal FTHB GST Rebate. E.g.
- APS signed; on or after March 20, 2025 to end of 2030
- Construction must begin before 2031 and be substantially completed before 2036.
Temp Expansion of Ontario PST Rebate
- Ontario is PROPOSING a temporary expansion of 13% HST relief of up to $130,000 for all eligible buyers of new homes – including repeat buyers and residential property investors – for one year.
- Qualification criteria:
- Will apply for agreements signed between April 1, 2026 and March 31, 2027;
- Construction must begin on or before:
- December 31, 2028 (for end users) or
- March 31, 2026 (for investors);
- Construction must be substantially completed on or before:
- December 31, 2031 (for end users) and
- December 31, 2029 (for investors); and
- New home must be used as a primary residence or res. rental property.
- Homes Under $1 Million: Ontario will provide relief equivalent to the full 13% HST, up to a maximum of $130,000;
- Homes Between $1 Million and $1.5 Million: The $130,000 maximum rebate will be maintained (meaning not all of the 13% HST will be rebated);
- Homes Between $1.5 Million and $1.85 Million: A reduced rebate will be available, decreasing proportionally as the purchase price increases;
- Homes Above $1.85 Million: Purchasers will not receive the expanded relief but will qualify for $24,000 in HST relief under the pre-existing “legacy” GST/HST New Housing Rebate rules.
Prov + Fed Cost Sharing Agreement
- As of today, neither the Provincial FTHB Rebate or Temporary Expanded Rebate are in effect;
- Bill C-26 is in its first reading in Federal Parliament – authorising payment from
- Feds to Province to fund the new Rebates;
- All parties trying to ensure "timely implementation";
- CRA will be handling all rebates – either online or via paper.
Who Should Pay Attention?
- First-time buyers considering new construction
- Rebate improves the affordability of new builds compared to resale.
- FTHB who signed agreements for new builds from March 20, 2025 forward will be eligible for the combined 13% relief, if they meet the criteria.
- Buyers close to qualification limits
- Reducing the effective purchase price can improve mortgage qualification outcomes under the stress test.
- Buyers planning ahead
- New construction often involves longer timelines, which can allow for more structured financial planning.
Applying for the New Rebates:
Depending on your agreement, the process will likely look like one of the following:
| If APS is signed after March 20, 2025 and before March 31, 2026: |
You will need to pay the sticker purchase price under the legacy program and apply for the NEW Federal and Provincial Rebates directly with the Canada Revenue Agency (CRA) after closing. In short, you must pay the funds upfront and apply yourself for the refund later.
CRA is recommending the online method, as it has faster response times:
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| If APS is signed after April 1, 2026, and has a clause stating that the builder will handle each rebate on buyer’s behalf: | You will receive the benefit of the rebates directly on closing with a reduced balance owing on the Final Statement of Adjustments. In this scenario, you do not need to apply, deal with the CRA, or wait months for funds to be refunded to you. |
| If APS is signed after April 1, 2026 and does NOT have a clause covering: | You will need to pay the full amount on closing and apply for the funds back later from the CRA, similar to the first scenario. |
As a reminder: When purchasing a pre-construction condo, you are provided with a 10-day rescission/ cooling-off period automatically. If purchasing a freehold property, you are NOT entitled to any form of cooling-off period, unless you negotiate in advance.
Example calculation A - FTHB
You purchased a new home with a sticker purchase price of $700,000. You signed after March 20, 2025 as FTHB but BEFORE the recent provincial/federal announcement OR your builder is refusing to handle the new rebates:
- Sticker Price: $700,000
- Net Price: $640,707.96 (Calculated by adding the already deducted $24,000 legacy HST Residential Rebate back to the sticker price and removing the 13% HST)
- Plus 13% HST: $83,292.04 (Made up of $32,035.40 Federal 5% GST and $51,256.64 Provincial 8% PST, bringing the total to $724,000)
- Less Legacy HST: -$24,000 (Residential Rebate already included in sticker purchase price)
- Final Total: Back to sticker price of $700,000
Rebates Available Breakdown:
- Existing Legacy HST Residential Rebate: $24,000 already included in the sticker price;
- New Federal FTHB 5% GST Rebate: You may apply for $32,035.40 back;
- New Provincial FTHB HST Rebate: Once province has passed mirror legislation, the remaining PST can be applied for. This is calculated as the $51,256.64 PST less the $24,000 legacy rebate already accounted for, leaving $27,256.64 more to be claimed;
The Bottom Line: At the end of the day, you will have claimed three rebates: the standard GST/HST New Housing Rebate ($24,000) + the new Federal FTHB GST Rebate ($32,035.40) + the new Provincial FTHB HST Rebate ($27,256.64). This equals $83,292.04 in total tax relief.
Example calculation B - FTHB $1-1.5 M
You purchased a new home with a sticker purchase price of $1,200,000. You signed after March 20, 2025 as FTHB but BEFORE the recent provincial/federal announcement:
- Sticker Price: $1,200,000
- Net Price: $1,083,185.84 (Calculated by adding the already deducted $24,000 legacy HST Residential Rebate back to the sticker price and removing the 13% HST)
- Plus 13% HST: $140,814.16 (Made up of $54,159.29 Federal 5% GST and $86,654.87 Provincial 8% PST, bringing the total to $1,224,000)
- Less Legacy HST: -$24,000 (Residential Rebate already included in sticker purchase price)
- Final Total: Back to sticker price of $1,200,000
Rebates Available Breakdown:
- Existing Legacy HST Residential Rebate: $24,000 already included in the sticker price;
- New Federal FTHB 5% GST Rebate: You may apply for a pro-rated amount, calculated as $41,681.42;
- New Provincial FTHB HST Rebate: Once province has passed mirror legislation, then a pro-rated PST can be applied for, less legacy rebate. PRESUMED calculations note $42,690.27 more to be claimed;
The Bottom Line: At the end of the day, you will have claimed three rebates: the standard GST/HST New Housing Rebate ($24,000) + the new Federal FTHB GST Rebate ($41,681.42) + the new Provincial FTHB HST Rebate ($42,690.27). This equals $108,371.69 in total tax relief out of the $140,814.16 owing.
Common Questions
Will I receive the rebate if my APS was signed before March 20, 2025 or April 1, 2026?
No! If you signed an APS with a builder a number of years ago (e.g., in 2022) and your home has not yet closed, these new rebates do not apply to you. The intention of both levels of government is strictly forward-looking – to sell inventory units and encourage new construction.
Can I apply for the rebate if I am an investor?
Yes! If you sign an agreement between April 1, 2026 – March 31, 2027, the expanded provincial rebate does apply to properties purchased for investment purposes.
Can I cancel my old APS and sign a new one with the builder after April 1, 2026?
No! Under federal anti-avoidance measures—which the province is fully expected to mirror—if an original agreement was entered into before the eligibility date, subsequently canceled, and replaced with a new agreement for the same property, the rebate will be firmly disallowed. These rules exist explicitly to prevent the "gaming" of the system.
Can I sell my old APS under an assignment sale to qualify for the new rebates after April 1, 2026?
No! If you purchase a property by way of assignment (taking over the contract from the original purchaser) after April 1, 2026, it does not reset the clock. The CRA bases eligibility on the date the original agreement was signed between the builder and the initial purchaser/Assignor. If the original contract pre-dates the March 20, 2025, or April 1, 2026, cut-offs, the property is ineligible for the new enhanced rebates.
Disclaimer: This guide is for informational purposes only and does not constitute financial, legal, or tax advice. Government programs are subject to change. Consult a real estate lawyer or tax professional regarding your specific situation before signing any real estate contracts.