How the April 2021 Budget Impacted GST/HST New Housing Rebates

Relaxation Of GST/HST New Housing Rebate Conditions

Under the existing rebate provisions in the GST/HST legislation and regulations, a GST/HST New Housing Rebate was restricted if there were multiple buyers, not all of whom were related, and not all of the buyers (or their relations) were acquiring the home for use as their (or a relation’s) primary place of residence. There have been a number of Tax Court cases that upheld denying the GST/HST New Housing Rebate on this basis, such as in situations where an unrelated party (perhaps a friend or a non-qualifying relation) was added to the agreement of purchase and sale (APS) and/or title to assist in obtaining mortgage financing.
Budget 2021 proposes to remove this restriction in respect of an APS for a new home entered into after April 19, 2021. Instead, the GST/HST New Housing Rebate will be available as long as the new home is acquired for use as the primary place of residence of any one of the purchasers or a relation of any one of the purchasers. Similar proposed amendments will apply to relax the conditions for GST/HST New Housing Rebates for owner-built homes.

Making Home Ownership More Accessible

Given the rising costs of home ownership this is great news for home buyers, and to a lesser extent, builders of new homes, as this allows “unrelated third parties” to be on title, which can lower borrowing costs and make homeownership more accessible to more buyers.

Our Tax Experts Can Help You Navigate the New Budget

We are Excise Tax Experts, and we understand nuances of the Excise Tax Act, the various rebates and the Canada Revenue Agency (CRA) rules and regulations. We maintain frequent contact with CRA decision makers so we can provide our clients with timely and complete advice about their rebates. We understand that the application process can often be challenging and stressful. Connect with us at (647) 281-5399 and we can show you how a rebate expert can help you to maximize your rebate and help you navigate the rebate process.

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Interested in finding how much you can get back?

If you've recently undergone substantial renovations, built or hired someone to build an addition, built or hired someone to build a new home, or purchased a new residential rental property, you can receive money back from the government. Use our free calculator to find out how much you qualify for.

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