GST/HST New Housing Rebate Canada 2026: Who Qualifies & How to Claim

When you buy a newly constructed home in Canada, you pay GST or HST on the purchase — and that tax adds up fast. On a $500,000 new build in Ontario, the HST is $65,000. Even at $350,000, you are paying $17,500 in GST. The federal and provincial governments have always intended new construction to stimulate housing supply, and the GST/HST new housing rebate is the mechanism that partially offsets the tax burden on buyers who purchase new homes as their primary residence.

The rebate is worth up to $6,300 from the federal government alone — and up to $30,300 combined when Ontario’s provincial rebate is included. But the rules are specific, the eligibility requirements have real teeth, and mistakes made at closing can result in unexpected bills of thousands of dollars.

This guide explains exactly who qualifies, how to calculate your rebate in every province, how the claims process works, and the mistakes that most commonly trip up buyers and investors.

When GST/HST Applies to a Home Purchase

The first question is whether GST or HST applies to your purchase at all. The rule is straightforward: new construction is taxable; resale from an individual is exempt.

Newly constructed homes, substantially renovated homes, and properties converted from non-residential to residential use are all subject to GST or HST. When you buy a brand-new condo pre-construction, a new detached home from a subdivision builder, or a converted commercial loft from a developer, you are paying GST or HST on that transaction. The tax is typically embedded in the purchase price rather than added separately, but it is real and it is substantial.

Resale homes — buying a used home from another individual — are exempt from GST/HST. You do not pay GST when you buy from someone who is selling the home they lived in. This is why the rebate does not come into play for the vast majority of real estate transactions in Canada.

Assignment sales — where the original pre-construction buyer sells their rights to the purchase contract before the home is completed — are a grey area that deserves its own section (see below). The tax treatment of assignments has been evolving and CRA scrutiny has increased.

GST vs HST: What Province Are You In?

The total tax rate you pay on a new home depends on your province. Ontario, Nova Scotia, New Brunswick, Newfoundland and Labrador, and PEI use the Harmonized Sales Tax (HST), which combines the federal 5% GST and a provincial component into a single rate. BC, Alberta, Saskatchewan, and Manitoba use the federal GST only (no provincial sales tax on new homes in those provinces). Quebec charges GST and its own QST separately.

This matters for the rebate calculation because the federal rebate only applies to the 5% federal portion, while provinces with HST may offer their own provincial rebate on the provincial portion — and those provincial rebates have very different caps and rules.

The province you are buying in determines both the total tax exposure and which rebates are available. Ontario and Newfoundland buyers have the most complex calculation — and the most generous total rebates — because both offer substantial provincial rebates on top of the federal one.

Federal GST New Housing Rebate

Who qualifies

The federal rebate is available when you meet all of the following conditions:

1. The property type qualifies. The home must be newly constructed by a builder, substantially renovated (at least 90% of the interior removed or replaced), or a conversion from non-residential to residential use.

2. Primary residence use. You, or a close relative (defined as a parent, child, grandparent, grandchild, sibling, spouse, or common-law partner), must intend to occupy the home as a primary place of residence. Vacation homes, investment properties, and rental properties do not qualify for the standard rebate. “Intend to use” is the test — you must have genuine intention at the time of purchase, not simply claim it retrospectively.

3. Buying from a registered GST/HST registrant. You must be purchasing from a builder who is registered for GST/HST — which covers virtually all commercial developers and builders. Owner-built homes follow different rules (Form GST191 rather than GST190).

4. Price is below $450,000. The federal rebate is fully eliminated above $450,000 purchase price. The rebate phases down between $350,000 and $450,000.

5. Filed within the deadline. You must file within two years of the date the home is first occupied or ownership is transferred, whichever is earlier.

Federal rebate amounts

The federal rebate is 36% of the GST paid on the purchase, subject to a maximum of $6,300. For homes at or under $350,000, the math is simple: multiply the purchase price by 5% (GST) and then by 36%. The result is your rebate, capped at $6,300.

For homes between $350,000 and $450,000, the rebate is phased out using a linear sliding scale. Above $450,000, the federal portion is zero.

The sliding scale formula

For any purchase price between $350,000 and $450,000, the federal rebate is:

Rebate = $6,300 × ($450,000 − Purchase Price) ÷ $100,000

Notice that the “purchase price” used in this formula is the price before GST is added. If a builder quotes you a price of $400,000 “plus applicable taxes,” that $400,000 is the pre-tax price for the rebate formula. If the builder quotes $452,000 including HST, you work backward to find the pre-tax price before applying the threshold test.

Provincial New Housing Rebates

The federal rebate is only half the story in provinces with HST. Several provinces layer their own rebates on top of the federal portion — and in Ontario’s case, the provincial rebate is often larger than the federal one and has no price ceiling.

Ontario: The Most Significant Provincial Rebate

Ontario’s provincial HST new housing rebate is available at any purchase price — this is the critical difference from the federal rebate. Where the federal portion disappears entirely above $450,000, Ontario’s provincial rebate of up to $24,000 applies on homes at any price: $500,000, $800,000, or $1,500,000.

The calculation: 75% of the 8% provincial portion of HST, capped at $24,000. The cap is reached at a purchase price of $400,000 (8% × $400,000 × 75% = $24,000). Above $400,000, the provincial rebate stays at the $24,000 maximum regardless of price.

This means that for a home priced above $450,000 in Ontario, the buyer receives no federal rebate but a full $24,000 provincial rebate. On a $700,000 new condo in Toronto, you save $24,000 in provincial HST through the rebate — a meaningful sum.

The Ontario provincial rebate is typically credited by the builder in the same way as the federal rebate — most Toronto and Ontario new condo agreements show the purchase price “net of HST rebate,” meaning both the $6,300 federal and $24,000 provincial rebates are already baked into the stated price.

Other Provincial Rebates

Quebec deserves specific mention. Quebec charges both federal GST and provincial QST (9.975%) separately. Both have their own new housing rebates with parallel structures. The QST rebate is 36% of the QST paid, up to a maximum of $9,975, for homes at or under $300,000. The QST rebate phases out between $300,000 and $450,000 and disappears entirely above $450,000. Combined with the federal GST rebate, a Quebec buyer of a $300,000 home can recover up to $6,300 (federal) + $9,975 (QST) = $16,275. The QST rebate is claimed on Revenu Québec Form VD-370.

British Columbia has no HST — only the federal 5% GST applies to new homes, with the same federal rebate structure (up to $6,300). BC also has a separate New Housing Rebate through the BC government that applies against the Property Transfer Tax for certain buyers, which is distinct from the GST rebate.

How the Rebate Interacts With Your Mortgage

This is a practical detail that many buyers overlook. In Canada, GST/HST on a new home is part of the total cost you finance — the tax is typically included in the mortgage if you are not paying it separately. The rebate then works as follows depending on which claim method you use:

When the builder credits the rebate: The purchase price you sign on is usually “net of rebate” — meaning the builder has already factored the $6,300 federal and (in Ontario) $24,000 provincial rebates into the final price. You do not see a separate rebate; it is simply embedded in a lower asking price. Your mortgage is based on this lower figure.

When you self-claim: You pay the full GST/HST at closing — this means you may need to fund it out of pocket or include it in your mortgage. Then CRA sends you a rebate cheque (typically $6,300–$30,300 depending on province), usually 4–8 weeks after filing. During that window you have effectively floated the tax. If you are mortgage-insured through CMHC, Sagen, or Canada Guaranty, note that CMHC calculates your insured mortgage amount based on the purchase price including GST/HST — the rebate you receive later does not reduce your insured mortgage principal, though you can use the cheque to make a lump-sum prepayment.

For high-ratio buyers (less than 20% down payment), the CMHC insurance premium is calculated on the total purchase price including tax. This is another reason why the builder crediting the rebate upfront — which lowers the stated purchase price — is more mortgage-efficient than self-claiming.

The Primary Residence Requirement in Practice

“Primary place of residence” sounds straightforward, but CRA examines this condition carefully in audits, particularly for pre-construction condos in high-demand markets where buyers sometimes claim primary residence but later rent the unit or flip it.

What qualifies:

• You or a close relative genuinely intend to move in and use the home as your main home
• A close relative includes your spouse or common-law partner, parent, child, grandparent, grandchild, or sibling

What does not qualify:

• Purchasing as a rental investment from day one
• Purchasing for a corporation or business entity
• Planning to rent out and claim it is “temporary” before you move in
• Purchasing a vacation or recreational property (even if you spend significant time there)
• Purchasing for a relative who is not “close” as defined above (e.g., aunts, uncles, cousins, friends)

The flip risk: CRA does not require you to live in the home for a specific minimum period, but it does look at circumstances. If you take possession, never move in, and immediately list the unit for rent, CRA can challenge the primary residence claim and demand repayment of the rebate plus penalties and interest. If you convert the home to a rental within a reasonable period (say, one to two years after genuinely living there), CRA generally does not retroactively deny the rebate — though you would owe GST/HST on the fair market value at the time of conversion.

Substantially Renovated Homes

Owner-renovators who gut an existing home and rebuild may qualify for the new housing rebate on the construction costs — provided the renovation meets CRA’s definition of “substantial.”

CRA’s test is demanding: at least 90% of the interior of the residential complex must be removed or replaced. This is a high bar. A full gut renovation that strips the interior to the exterior walls and rebuilds everything — new framing, insulation, drywall, electrical, plumbing, HVAC, windows, kitchen, bathrooms, flooring — would typically qualify. A renovation that updates the kitchen, two bathrooms, and all the floors while keeping existing walls, ceilings, and electrical panels in place would typically not pass the 90% test.

Substantially renovated homes use Form GST191 (owner-built/renovated) rather than GST190. You have two years from the date of substantial completion to file. Given the amount of money at stake (potentially $6,300–$30,300 in combined rebates), getting a GST/HST specialist to confirm eligibility before committing to a major renovation is well worth the advisory fee.

Assignment Sales and the GST/HST Rebate

Assignment sales — where a pre-construction buyer sells their contract to a new buyer before the home is built — have become a significant issue in Canada’s new housing rebate landscape, particularly in Toronto and Vancouver pre-construction condo markets.

For the assignor (original buyer selling the contract): CRA has made clear that profit from an assignment is generally taxable. If the original buyer was not a GST/HST registrant and is selling the contract for more than they paid, they may owe GST/HST on the profit from the assignment. CRA has been actively auditing assignment sales in hot pre-construction markets.

For the assignee (buyer of the contract): The assignee generally qualifies for the new housing rebate when they take title to the completed home — the same conditions apply as a direct purchase from a builder. However, the “purchase price” for rebate threshold purposes may include the assignment fee paid to the original buyer, which can push the effective price above $450,000 and eliminate the federal rebate.

Assignment transactions are complex and the tax treatment depends on the specifics of how the agreement is structured and what CRA considers the “cost” of the home. If you are buying an assignment, engage a real estate lawyer with pre-construction experience and a tax accountant before signing.

How to Claim the Rebate

Method 1: Through the builder (standard for new builds)

Most builders include the rebate in the purchase price. This is the most common approach for condominium and new home builders, and it simplifies the process significantly for buyers.

When you sign the purchase agreement, the builder has you complete Form GST190 (Schedule B or C) assigning your right to the rebate to them. The builder then claims the rebate directly from CRA and keeps it — but they have also sold you the home at a price that reflects the reduced cost. In effect, the rebate comes to you as a lower purchase price rather than a separate cheque.

The key risk: if you assign the rebate to the builder but you do not actually qualify (because you are buying for investment, not primary residence), the builder will charge back the rebate amount — often tens of thousands of dollars — at closing. Your purchase agreement will specify this obligation. Always be transparent about your intended use of the property before signing.

Method 2: Self-claim (when the builder does not credit the rebate)

If the builder did not credit the rebate in the purchase price, or if you are claiming the rebate on a substantially renovated home, you self-claim directly with CRA:

1. Download Form GST190 from the CRA website (or Form GST191 for owner-built/substantially renovated homes)
2. Gather supporting documents: purchase agreement, statement of adjustments, proof of possession (keys transfer date, move-in evidence), proof of ownership (land registry transfer)
3. Complete and sign the form. Part A covers the rebate calculation; Part B covers your eligibility declarations
4. Mail to the CRA Sudbury Tax Centre (address on the form) or submit through your CRA My Account
5. Wait for processing. Self-claims typically take 4–8 weeks. CRA mails a rebate cheque to the address on file or deposits directly if you have direct deposit set up

You have two years from the date the home is first occupied (the later of the title transfer or the day you or a relative move in) to file. Missing this deadline forfeits the rebate permanently — there is no mechanism to claim late.

Common Mistakes That Cost Buyers Money

Rebate errors tend to be costly. The most common mistakes in order of frequency:

1. Assuming the builder credited the rebate without verifying. Check your purchase agreement carefully. Look for language like “purchase price net of HST rebate” or “purchaser assigns GST/HST rebate to vendor.” If this language is absent, the rebate may not have been credited.

2. Buying as an investment but intending to claim primary residence. If you plan to rent the unit rather than live in it, you do not qualify for the standard rebate. Use the rental property rebate (Form GST524) instead — it provides a similar benefit without the primary residence requirement.

3. Missing the two-year filing deadline. The clock starts on the date of first occupancy. For a self-claim, if you wait and forget, the rebate is lost permanently. Set a reminder well in advance.

4. Confusing the “price” threshold for the rebate. The $350,000/$450,000 thresholds apply to the purchase price before GST/HST, not the all-in price with tax included. This matters for edge cases near the threshold.

5. Assuming a resale home qualifies. Resale purchases from private individuals are GST/HST-exempt — no rebate applies because no GST/HST was paid.

6. Assuming a gut renovation qualifies without meeting the 90% test. CRA can and does audit renovation claims. If the renovation does not actually meet the 90% interior removal standard, CRA will deny the rebate and may assess penalties.

7. Double-claiming when the builder already credited the rebate. If the builder assigned the rebate to themselves and reduced your purchase price, filing Form GST190 again creates a duplicate claim CRA will reject — and if processed, you will be required to repay it.

8. Ignoring the provincial rebate. Ontario buyers purchasing above $450,000 sometimes incorrectly assume there is no rebate at all. The federal portion disappears above $450,000, but the Ontario provincial rebate of up to $24,000 remains available at any price.

GST/HST Rebate for New Rental Properties

Investors buying new homes as long-term rental properties do not qualify for the standard new housing rebate — but they are not without recourse. The New Residential Rental Property (NRRP) Rebate provides equivalent federal and provincial relief for landlords:

• Federal component: 36% of GST paid, maximum $6,300 — same as the standard rebate
• Ontario provincial component: 75% of provincial HST, maximum $24,000 — same as the standard rebate
• Filing form: GST524 (federal); Ontario Form for provincial component
• Key requirement: The property must be rented to an arm’s-length tenant under a long-term lease within 12 months of closing. Short-term rentals (Airbnb-style) do not qualify
• Filing deadline: Two years from closing

The NRRP rebate effectively puts rental investors on equal footing with owner-occupants for GST/HST recovery purposes. If you are buying a new condo as an investment in Ontario, you can recover up to $30,300 in combined federal and provincial HST — provided it is rented to a long-term tenant within the required timeframe.

Quick Eligibility Summary

Related Pages

• Closing Costs Guide by Province
• What Are Closing Costs in Canada?
• Land Transfer Tax in Canada
• Ontario Closing Costs Calculator
• BC Closing Costs Calculator
• CMHC Mortgage Insurance Calculator
• First-Time Home Buyer Guide Canada
• Title Insurance in Canada