First-Time Home Buyers' GST/HST Rebate in Canada: Who Qualifies

Buying a new home means paying GST/HST on the price, and for a first-time buyer that can be a large sum. The federal government created a first-time home buyers' (FTHB) rebate to return part or all of that tax on new homes, including homes you build yourself.

This article explains the federal rules only: who qualifies, the timing windows, how the amount is worked out, and the situations that catch people out. Provincial programs differ and are not covered here.

This article covers Canadian federal tax law, which applies in every province.

Who qualifies for the rebate

The rebate is set out in section 254(2.1) of the Excise Tax Act for homes bought from a builder. The owner-built version is in section 256(2.1). To qualify, you generally need to meet all of the following:

• You are at least 18.
• You are a Canadian citizen or permanent resident.
• You have not lived in a home you owned, alone or jointly, as your primary residence in the current calendar year or the previous four years.
• Neither you nor your spouse or common-law partner has received an FTHB rebate before.
• You will be the first occupant and you are buying the home as your primary residence.

The lookback also looks at your partner. A spouse or common-law partner's prior home ownership in the lookback period, and any earlier FTHB rebate they received, count against you.

A person can claim the FTHB rebate only once in their lifetime.

The timing windows

For a home bought from a builder, the agreement of purchase and sale must be entered into after March 19, 2025 and before 2031. Construction must begin before 2031, be substantially completed before 2036, and ownership must transfer before 2036. CRA lists March 20, 2025 as the earliest agreement date.

For an owner-built home, construction or renovation must begin after March 19, 2025 and before 2031, and be substantially complete before 2036.

How much you can get

For a new home with total consideration of $1,000,000 or less, the rebate is the lesser of $50,000 and the tax paid, minus any rebate under section 254(2). Between $1,000,000 and $1,500,000 it phases out under the formula C × [($1,500,000 − D) ÷ $500,000]. C is the lesser of $50,000 and the tax paid, and D is the total consideration. At $1,500,000 or more it is nil.

For example, a $1,250,000 home gets half, up to $25,000.

The FTHB rebate can be claimed in addition to the regular new housing rebate, as a top-up. Above $450,000 the regular rebate is nil, so the FTHB rebate is the only federal relief available on those homes.

Special cases and traps

• Mobile, modular and floating homes: individuals may get the FTHB rebate for only part of the GST/HST paid.
• Co-op shares: they are not eligible if the co-op housing qualifies for the 100% GST rebate for purpose-built rental housing.
• Leased land and co-op shares: CRA tests the thresholds differently, at $472,500 for the base test and $1,575,000 for the first-time buyer test.
• Assignments: a first-time buyer who takes over another person's builder agreement signed before the Finance announcement cut-off date of May 27, 2025 cannot claim the FTHB rebate. Cancelling and replacing an earlier agreement may also disallow it.
• Dates: the Finance announcement refers to May 27, 2025, while the statute and CRA use the March 2025 dates for when the agreement must be entered into. If you took over an assignment, it is worth confirming with a lawyer or accountant which dates apply to your agreement.

If you do not pass the first-time test

A buyer who fails the first-time buyer test may still qualify for the regular GST/HST new housing rebate. For a builder purchase, that rebate generally requires total consideration under $450,000 and that you or a relation will use the home as a primary place of residence. The rebate is the lesser of $6,300 and 36% of the tax paid when consideration is $350,000 or less, and it phases out up to $450,000.

What to do next

• Check your birthdate, status, and your home ownership history for the current year and the previous four years.
• Check whether your spouse or partner has owned a home in that period or received an FTHB rebate.
• Confirm the dates in your purchase agreement, and whether it was assigned to you.
• Ask your builder whether it will pay or credit the rebate at closing.
• Keep your statement of adjustments and records, and speak to a lawyer or accountant if your situation is unusual.

Frequently asked questions