The first-time home buyers GST/HST rebate on new homes

New builds · 7 min read · Figures checked October 13, 2026

New homes carry a tax that resale buyers never see itemized: GST — or HST in harmonized provinces — is charged on a brand-new or substantially renovated home, and on a typical new build that tax is tens of thousands of dollars. A federal rebate aimed specifically at first-time buyers can now return up to $50,000 of that tax, but it sits next to an older, much smaller rebate with a similar name, and the two are constantly confused. This guide separates them, prices the new rebate at three home values, explains the eligibility test that decides everything, and walks through both ways of claiming.

A rebate that only exists on new homes

The first-time home buyers' GST/HST rebate is for eligible individuals who are buying, building, or substantially renovating a first home. Two conditions about the home itself are built into the Canada Revenue Agency's description: it must be newly built or substantially renovated, and it must be for use as the buyer's primary place of residence. A resale home that has not been substantially renovated does not qualify, no matter how clearly the buyer is a first-time buyer.

Substantially renovated has a specific meaning here. The CRA describes a major renovation in which the interior is essentially gutted: generally, 90 percent or more of the interior of the existing housing has to be removed or replaced, with structural elements such as the foundation, exterior and interior support walls, roof, floors, and staircases excluded from that calculation. A kitchen refresh on a resale home is not a substantial renovation, and buyers counting on the rebate for a renovated property should confirm the 90 percent test before signing.

How much: the phase-out, priced at three values

The rebate returns the GST, or the federal portion of the HST, paid on the home. At or below a $1 million value, an eligible buyer can recover up to 100 percent of that federal tax, to a maximum rebate of $50,000. Between $1 million and $1.5 million, the maximum rebate is gradually reduced. At or above $1.5 million, there is no rebate. Priced out, using the CRA's own midpoint example:

The $1.25 million row is the CRA's published example: a home at the midpoint of the phase-out range is eligible for 50 percent of the $50,000 maximum, a $25,000 rebate. Note what the rebate does not touch: in an HST province, only the federal portion of the harmonized tax is covered by this federal program. Provincial portions are handled by separate provincial rebates — the CRA notes, for example, an Ontario first-time home buyers' rebate for the provincial part of the HST that follows the same eligibility conditions — so an Ontario buyer should check both layers rather than assuming one application covers the full tax.

Who counts as a first-time buyer here

This program's definition is its own, and it is a look-back test rather than a lifetime test. Based on the enacted program rules, the buyer must be at least 18 years old and a Canadian citizen or permanent resident, and must not have lived, as a primary place of residence, in a home that the buyer — or the buyer's spouse or common-law partner — owned or jointly owned, in Canada or anywhere else, at any time in the calendar year of the purchase or in the four preceding calendar years. Someone who owned and lived in a home more than five calendar years ago can qualify again under this test; someone who sold a home two years ago cannot, even though they own nothing today.

The dates attached to the home matter just as much. For a home bought from a builder, the agreement of purchase and sale must be entered into on or after March 20, 2025 and before 2031; construction must begin before 2031 and be substantially completed before 2036, with ownership transferring before 2036. The March 20, 2025 start date deserves attention because older coverage of the original proposal used a later May 2025 date — presale buyers in particular should check which side of the line their agreement falls on. The rebate was enacted through Bill C-4, which received Royal Assent on March 12, 2026, and the CRA is now accepting applications.

Two rebates, one purchase: how they fit together

The older program is the GST/HST new housing rebate. It is not limited to first-time buyers, and it is much smaller: a rebate of 36 percent of the GST or federal part of the HST paid, up to a maximum of $6,300, with no rebate at all once the purchase price or fair market value reaches $450,000. At current new-home prices in most cities, that older rebate phases out long before it helps.

Where both rebates apply to the same purchase, the first-time buyers' rebate operates as a top-up to the standard rebate rather than a replacement, so an eligible first-time buyer is not forced to choose the better of the two. The practical takeaway is simpler: a first-time buyer pricing a new build should model the first-time buyers' rebate first, because it is the one large enough to change the affordability math.

How to claim: builder credit or file yourself

1. Confirm first-time status against the look-back test. Check the current calendar year plus the four preceding years, for both the buyer and a spouse or common-law partner, including homes owned outside Canada.
2. Confirm the home and the dates. The home must be newly built or substantially renovated, intended as a primary place of residence, with the agreement, construction-start, completion, and ownership dates inside the program windows described above.
3. Ask the builder, before closing, whether the rebate will be credited. Builders can credit the first-time buyers' rebate against the total amount payable when ownership transfers, which means the benefit arrives at closing instead of months later.
4. If the builder does not credit it, file with the CRA. The buyer applies directly, through a CRA account or by mailing Form GST190, the new housing rebate application for houses purchased from a builder.
5. Respect the filing deadline. There is a time limit to apply — usually within two years of taking ownership or finishing construction. Diarize it at closing; a missed window means the rebate is gone, not delayed.
6. In an HST province, check the provincial rebate separately. Provincial new housing rebates are distinct programs with their own applications, even when their eligibility conditions mirror the federal ones.

What success looks like: either the closing statement shows the rebate credited by the builder against the amount payable, or the buyer holds a submitted CRA application — with the agreement of purchase and sale and closing documents kept on file — well inside the two-year window, and can state the exact rebate amount expected rather than a hopeful estimate.

FAQ

Does the rebate apply to a resale home? No. The home must be newly built or substantially renovated under the 90 percent test. A standard resale purchase does not qualify.

A home was owned and sold three years ago. Does the buyer qualify? Under the look-back test, no: having lived in an owned home as a primary residence within the current calendar year or the four preceding calendar years disqualifies the buyer, even if nothing is owned today. Ownership that ended outside that window does not.

Can the rebate be claimed twice? The program is built around a first home and its first-time buyer test, and the CRA's application process assumes one qualifying claim; a buyer who has already received this rebate should confirm eligibility directly with the CRA before counting on a second one.

General information only, not financial or tax advice. Rebate amounts, eligibility rules, and program dates are set by the federal government and administered by the Canada Revenue Agency, and provincial rebates have their own rules — confirm current details with the CRA or a qualified tax professional before signing a builder agreement.