Do I get an HST rebate when I buy a newly built home in Ontario?

Yes, buyers of newly built homes in Ontario may be eligible for two rebates: a federal HST new-housing rebate and an Ontario new-housing rebate. Together these can significantly reduce the tax payable on a new home.

The federal rebate applies to homes priced up to a threshold and phases out above that threshold. The Ontario rebate (36% of the provincial portion of HST, up to certain limits) applies to homes used as a primary residence. In many new-construction transactions the builder factors the rebate into the purchase price and assigns the rebate claim to themselves, meaning you receive a "net" purchase price. Read your purchase agreement carefully: if you have assigned the rebate to the builder, you must occupy the home as your primary residence — renting it out instead could require you to repay the rebate.

If you intend to purchase a new-build as an investment property or rental, the rebate structure is different and additional rules apply. The Canada Revenue Agency administers the federal portion of the rebate, and timelines for filing are strict.

Because the interaction between the purchase agreement, rebate assignment, and intended use can have significant financial consequences, discuss this with your lawyer and an accountant before signing.