Do You Pay GST on a Resale Home or Condo in Alberta?

When you buy a house or condo that someone has lived in, you probably expect the price to be the whole cost. In most cases that is how GST works for resale homes in Alberta, but there are exceptions worth knowing about.

This article explains the general rule, the situations where GST can still apply, and how that differs from buying a new home from a builder. Your own facts decide the answer, so use this as a guide to the questions to ask.

This article covers the law of Alberta.

Alberta has no PST, only GST

Alberta has no provincial sales tax, so no PST is charged on a home purchase. Only federal GST can apply, and that is mainly to new homes and certain other cases.

GST is charged at 5% of the value of the consideration on a taxable supply made in Canada, and the buyer pays it. The key question for a resale is whether the sale is a taxable supply at all.

Alberta also charges no land transfer tax on a home purchase. Buyers instead pay Land Titles registration charges based on the value of the land, which is generally the purchase price. Those charges are separate from GST. The Land Titles transfer levy is $50 plus $5 for each $5,000 or portion thereof of the value of the land, for submissions received on or after October 20, 2024. Any part of a $5,000 increment is charged as a full increment, so a $400,000 value gives $50 + 80 × $5 = $450.

The general rule: resale homes are exempt

Schedule V, Part I, section 2 of the Excise Tax Act makes the sale of a residential complex exempt from GST when it is made by a person who is not a builder of the complex. In everyday terms, if you buy a previously owned home from an ordinary homeowner, GST generally does not apply to the price.

This is why most buyers of resale houses and condos do not see GST on their closing documents.

Exceptions where GST may still apply

The exemption is not unlimited. The Act and CMHC guidance describe situations where a resale can still involve GST.

• The seller claimed an input tax credit on the last acquisition of the complex, for example a unit used in a business.
• A GST-registered recipient bought from a prior taxable seller within one year, no individual has lived in the home since construction or the last substantial renovation, the sale follows a right to purchase in the prior agreement, and an election is filed.
• For a resale condo, CMHC states GST may apply where the seller used the unit mainly (over 50%) for business, claimed input tax credits for improvements, or the unit was substantially renovated.

These situations are most common with investor-owned or recently renovated properties. If the seller is a business, a corporation or a flipper, ask early whether GST is part of the deal.

How this differs from a new home

A new home is treated differently. Buyers of new condominium units in Alberta pay GST on the purchase price, and the GST/HST New Housing Rebate can reduce it on a declining scale based on price. For new homes bought from a builder, a CRA policy statement from 1998 says GST is payable on the full consideration at final closing, when possession is transferred, but it may not reflect later changes, so confirm the timing with your lawyer.

The builder self-supply rules can also treat a builder as having sold the home once construction or substantial renovation is substantially completed and possession is first given, with tax calculated on fair market value. These rules do not apply to an individual builder who uses the home primarily as a residence for themself, a related individual or a former spouse or common-law partner and has not claimed an input tax credit.

A substantially renovated home can fall into the new-home side. Generally 90% or more of the existing house's interior must be removed or replaced for the substantial renovation test, and foundation, exterior and supporting walls, roof, floors and staircases need not be replaced. The New Housing Rebate is 36% of the GST paid, to a maximum of $6,300. It is available in full when the home's value is $350,000 or less, is reduced between $350,001 and $449,999, and is nil at $450,000 or more. The home must be bought or built as the primary place of residence of the claimant or a relation, and a recreational cottage or investment property does not qualify. A claim must be made within two years after the base date. The First-Time Home Buyers' GST/HST rebate can be up to 100% of the GST on a new or substantially renovated first home, to a maximum of $50,000. It is full at a price of $1 million or less, gradually reduced between $1 million and $1.5 million, and none at $1.5 million or more. For a home bought from a builder, the purchase agreement generally must be dated on or after March 20, 2025, and the builder can usually credit the rebate at closing.

What to do next

• Ask who the seller is and whether they have ever used the home for business.
• Find out whether the home was recently renovated or built, and by whom.
• Check your purchase contract for how GST is dealt with. It depends on the contract and the facts, so have your lawyer confirm.
• If GST might apply, ask your lawyer or an accountant about rebates that could reduce it.
• Do this before you remove conditions, not at closing.

Frequently asked questions