The New Home HST Rebate can save you up to $30,300 — but most Toronto condo buyers get very little. Here's why.
When you buy a new home in Ontario, you pay 13% HST on the purchase price. The government provides a rebate on part of that HST for buyers who will use the home as their primary residence. The maximum rebate is $30,300 — but it phases out completely for homes over $450,000. Since most new Ontario condos cost well above that, most buyers get a minimal rebate. Here's the full breakdown.
The New Home HST Rebate has two components, calculated separately:
The federal government rebates 36% of the 5% GST portion of HST. The maximum federal rebate is $6,300 (at a purchase price of $350,000 or less). The rebate phases out gradually as the price increases from $350,000 to $450,000. For homes over $450,000, the federal rebate is $0.
Ontario rebates 75% of the 8% provincial portion of HST. The maximum Ontario rebate is $24,000 (which is reached at a purchase price of $400,000 or less). For homes over $400,000, the maximum Ontario rebate is the lesser of $24,000 and 75% of the Ontario portion paid. For homes over ~$484,000, the Ontario rebate is capped at $24,000 and doesn't phase out — it stays flat at $24,000 for any price above $400K.
In most new condo purchases in Ontario, the developer will include language in the Agreement of Purchase and Sale requiring you to assign the HST rebate to the builder. The developer claims the rebate on your behalf, and the purchase price you see is net of the rebate. This works fine if you're buying for personal use.
However, if you plan to use the property as an investment/rental, you do NOT qualify for this rebate — but you've already "assigned" it to the builder who built the rebate assumption into the price. This means:
If you're buying new for rental purposes, discuss this with your lawyer before signing the APS.
Investors purchasing new construction for long-term rental can claim the New Residential Rental Property (NRRP) Rebate instead. The rebate is the same amount as the personal use rebate, but the property must be rented to a tenant at arm's length as their primary place of residence. The tenant must occupy it within one year of completion. This effectively means investors can purchase new builds without paying net HST, provided they meet the rental requirements.
| Purchase Price | Federal GST Rebate | Ontario Rebate | Total Rebate |
|---|---|---|---|
| $300,000 | $5,400 | $18,000 | $23,400 |
| $350,000 | $6,300 (max) | $21,000 | $27,300 |
| $400,000 | $4,500 | $24,000 (max) | $28,500 |
| $450,000 | $0 | $24,000 | $24,000 |
| $600,000+ | $0 | $24,000 | $24,000 |
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