Buying a home in Ontario means paying 13% HST on top of the purchase price. That cost adds up fast. Fortunately, the CRA offers a rebate on part of that HST, and many buyers qualify without knowing it.
This guide explains how the new housing rebate works, who qualifies, and how to claim it.
Key Takeaways:
- The federal government and Ontario each offer a separate rebate on HST paid for new homes, worth up to $30,300 combined.
- To qualify, you must intend to use the property as your primary place of residence at the time you sign the agreement.
- CRA uses fair market value, not just the purchase price, to determine your federal rebate amount.
- Investors buying new rental homes apply for the NRRP rebate instead, using Form GST524 + RC7524-ON.
- The first-time home buyers’ GST/HST rebate of up to $50,000 became law in March 2026, and Ontario’s rebates on the provincial part can add up to $80,000 for eligible new homes.
What Is the GST/HST New Housing Rebate?
When you purchase a new or substantially renovated home in Ontario, you pay 13% HST on the purchase price. The HST new housing rebate returns part of that tax to qualifying buyers, reducing the upfront cost of buying a home.
The rebate has two parts:
| Component | Based On | Maximum Rebate |
|---|---|---|
| Federal rebate | 5% federal portion of the HST | $6,300 |
| Ontario rebate | 8% provincial portion | $24,000 |
| Combined | $30,300 |
In most new home purchases, builders factor the rebate into the sale price. You assign the rebate to the builder at closing, and they apply for it on your behalf. If you paid the full HST yourself, which is common when building your own home, you apply to the CRA directly.
Assignment sales are an important exception. If you purchased on assignment (buying from the original purchaser before closing rather than directly from the builder), the builder typically will not credit the rebate to you. In that case, you apply directly to the CRA after closing and receive the rebate as a deposit to your bank account, typically within six weeks.
The rebate is intended to make homeownership more affordable for Canadian families, not to subsidize investment properties. Investors follow a separate process covered below.
Eligibility: Who Can Qualify for the GST/HST New Housing Rebate?
To qualify for the HST rebate, you must intend to use the property as your primary place of residence. The CRA assesses intent at the time you sign the purchase agreement, not just at closing.
The rebate also applies if a relation of the purchaser will use the home as their primary residence. Under the Excise Tax Act (ETA s. 254(2)), “relation” means parents, grandparents, children, grandchildren, siblings, and spouses or common-law partners. It does not include cousins, nieces, nephews, aunts, or uncles. CRA will deny the rebate in those cases.
You may be eligible if you:
- Purchased a new home or new condo from a builder
- Built or hired someone to build a newly constructed home on land you own
- Substantially renovated your existing home (90%+ of interior structure removed and replaced)
- Purchased a mobile home or floating home from a builder
You do NOT qualify if:
- The property is a vacation or secondary residence
- You’re buying it solely for rental income (see NRRP rebate below)
- Your home is priced above $450,000. The federal rebate shrinks as your price rises above $350,000, and disappears completely at $450,000 (the Ontario rebate still applies regardless of price)
One thing many pre-construction buyers miss: the CRA uses fair market value (FMV) at the time of substantial completion, not just the price you signed for. If you signed a pre-construction contract at $420,000 but the home is worth $480,000 by the time it’s built, you lose the federal rebate entirely, even though your contract price was below $450,000.
The rebate is available to all eligible buyers, not only first-time home buyers. If you’ve previously owned property and are now buying a new primary residence, you can still qualify. Eligibility turns on how you use the home, not your purchase history.
GST/HST Rebate Amount: How Much Can You Get Back?
Federal portion rebate:
The federal government rebates 36% of the 5% federal HST you paid, but only if your home is priced under $450,000. Think of it as the CRA giving back roughly one-third of the federal tax portion.
- Homes at $350,000 or less: rebate = 36% × 5% × purchase price, up to $6,300
- Homes between $350,000 and $450,000: the rebate shrinks the higher your price gets. At $350,001 you get slightly less than $6,300; at $449,999 you get almost nothing. The formula is: $6,300 × ($450,000 − purchase price) / $100,000
- Homes at $450,000 or more: the formula produces $0: no federal rebate applies at this price point
Ontario portion rebate:
Ontario’s rebate works differently. It covers the provincial portion of your HST, but only on the first $400,000 of your purchase price. Any amount above $400,000 is not factored in. In practical terms, you pay only 2% provincial HST on the first $400,000 (instead of the full 8%), and Ontario rebates the other 6%.
- Rebate = 75% × 8% × first $400,000 of purchase price
- Maximum rebate: $24,000 (which is 6% of $400,000)
- No upper price limit: even if your home costs $800,000, you still receive the full $24,000 Ontario rebate, because the calculation is always capped at the first $400,000
This is an important distinction: once your home crosses $450,000, you lose the federal rebate entirely, but Ontario’s formula still runs its own calculation and still pays out up to $24,000.
Example 1: $300,000 new home:
- Federal rebate: $300,000 × 5% × 36% = $5,400
- Ontario rebate: $300,000 × 8% × 75% = $18,000
- Total rebate: $23,400
Example 2: $500,000 new condo:
- Federal rebate: $0 because the purchase price is above $450,000, so the federal formula produces nothing
- Ontario rebate: calculated on first $400,000 only → $400,000 × 8% × 75% = $24,000
- Total rebate: $24,000. Ontario still pays in full even though the federal portion is gone
What the examples show at a glance:
| $300,000 Home | $500,000 Condo | |
|---|---|---|
| Federal rebate | $5,400 | $0 |
| Ontario rebate | $18,000 | $24,000 |
| Total | $23,400 | $24,000 |
The key takeaway: a more expensive home doesn’t necessarily mean a smaller total rebate. The Ontario rebate grows with the purchase price (up to its $24,000 cap) and can offset the loss of the federal portion entirely.
GST New Residential Rental Property Rebate
If you’re purchasing new homes to rent out rather than live in, the personal rebate doesn’t apply. You may instead qualify for the New Residential Rental Property (NRRP) rebate, also called the HST rental rebate.
The NRRP rebate applies when you:
- Purchase new residential property (house, new condo, or other unit) to rent long-term
- Rent the property to tenants at arm’s length at fair market rent
- Are providing the first residential use of the property
To apply for the new residential rental property rebate, you file directly with the CRA. Builders do not assign this rebate. You use Form GST524 (federal NRRP rebate application) and attach Form RC7524-ON (Ontario NRRP rebate schedule). Note: Form GST525 is only for co-operative housing or multi-unit complexes and does not apply to standard single-unit purchases.
Documents required to apply for the NRRP rebate:
- Copy of the agreement of purchase and sale
- Copy of the closing statement of adjustments
- Copy of a one-year lease agreement
If you own multiple rental properties or are unsure which rebate applies, a CPA who works with real estate investors can help you navigate the rules before closing.
How to Claim the GST New Housing Rebate
Who files: you or your builder?
This depends on what happened at closing. If your builder credited the rebate against your purchase price or paid it to you directly at closing, the builder is responsible for filing the rebate application with the CRA, not you. This is the most common scenario for new builds where the rebate is factored into the sale price.
If the builder did not credit or pay the rebate to you, which is typical in assignment sales or certain custom builds, then you apply directly.
Applying directly to the CRA:
Use CRA Form GST190 if you purchased from a builder, and attach Form RC7190-ON (the Ontario rebate schedule). If you owner-built or substantially renovated your home, use Form GST191 with Form GST191-WS (the construction summary worksheet) and attach Form RC7191-ON for the Ontario portion.
You will need the following documents:
- Copy of your agreement of purchase and sale
- Legal description of the property: the lot number and plan number, usually found in your lawyer’s closing package
- Builder’s legal name and GST registration number
- Closing statement of adjustments
You can submit your application online through CRA My Account or by mail to your CRA tax centre. Once approved, the CRA typically deposits the rebate directly to your bank account within six weeks.
Filing deadline: when does the two years start?
- Purchased from a builder: two years from your possession date (closing)
- Owner-built or substantially renovated: two years from the date construction is substantially complete (90%+ done), not your move-in date
- NRRP rebate: two years from the date of first rental use
Missing the deadline forfeits your rebate. There are no extensions under any circumstances.
If the CRA questions your claim, CRA audit representation from a CPA can help protect your position.
First-Time Home Buyers GST/HST Rebate: Now in Force
In May 2025, the federal government announced a new rebate specifically for eligible first-time home buyers on new homes, separate from the existing new housing rebate covered in this guide.
The rebate provides 100% relief of the federal GST portion on new homes valued up to $1,000,000, with a phase-out between $1,000,000 and $1,500,000. The maximum federal saving is $50,000. Ontario’s rebates on the 8% provincial part can add up to $80,000, for combined relief of up to $130,000 on an eligible new home.
Current status (September 2026): Bill C-4 (Making Life More Affordable for Canadians Act) received Royal Assent in March 2026, and the CRA began accepting applications for the first-time home buyers’ GST/HST rebate that month. The rebate is up to $50,000 on a new home valued at or below $1 million, gradually reduced between $1 million and $1.5 million, with no rebate at $1.5 million or more. Buyers can apply directly to the CRA, usually within two years of taking ownership or finishing construction. For the 8% provincial part, the CRA also sets out Ontario’s first-time home buyers’ rebate and, for homes bought from a builder under agreements from April 1, 2026 to March 31, 2027, the Ontario enhanced new housing rebate. All Ontario rebates on the provincial part are capped at the lesser of $80,000 and the provincial HST payable.
If you are a first-time home buyer purchasing new construction, work these rebates into your numbers before you sign, because they can change your rebate calculation significantly.
Conclusion
The HST new housing rebate can put tens of thousands of dollars back in your pocket when you buy a new home in Ontario. Whether you’re a first-time home buyer or an experienced investor purchasing new residential rental properties, knowing the rules ensures you claim every dollar available.
Quick reminders:
- Maximum combined rebate: up to $30,300 (federal + Ontario)
- Federal rebate shrinks above $350,000 and disappears at $450,000; Ontario rebate has no upper price limit
- Investors use the NRRP rebate, not the personal rebate
- File your rebate application within two years of closing
Unsure whether you qualify or how to apply? FShad CPA can review your situation and help you get the maximum rebate possible.
Frequently Asked Questions
Who qualifies for the new home HST rebate in Ontario?
Anyone who purchases a new or substantially renovated home to use as their primary place of residence. You don’t need to be a first-time home buyer. Eligibility is based on how you intend to use the property, not your purchase history.
Can I get the rebate on a pre-construction condo?
Yes. The condo HST rebate follows the same rules as a new house. Many builders factor the rebate into the sale price, so confirm in your purchase agreement whether the rebate is being assigned to the builder or whether you need to apply separately.
What is the NRRP rebate and who should use it?
The NRRP rebate applies to investors who purchase new residential rental property to rent to tenants. Unlike the personal new housing rebate, home buyers using the NRRP rebate apply directly to the CRA. Builders don’t handle it. The two rebates are mutually exclusive; confirm which applies before filing.
What happens if I rent out the property after claiming the personal rebate?
Changing the use of your home from personal to rental after claiming the rebate may require repayment. The Excise Tax Act (ETA) treats a change of use as a deemed supply. Discuss your plans with a CPA before renting out a property where you’ve already claimed a rebate.
Is the Ontario rebate available in other provinces?
No. Ontario has its own provincial new housing rebates program. Provincial new housing rebates vary: British Columbia, Alberta, and the Atlantic provinces each have different rules. This guide covers the federal and Ontario portions only. Verify rules for your province before applying.
GST/HST New Housing Rebate Calculator
Ontario HST New Housing Rebate Estimator
Enter your purchase price to estimate your federal and Ontario HST rebate. For Ontario new home purchases only.
