What is the Ontario HST Rebate for new homes?
The Ontario HST rebate removes the full 13% HST on eligible new homes valued up to $1 million. This means qualifying buyers pay no HST on the purchase of a new construction home — saving up to $130,000 depending on the purchase price. The rebate applies to the entire HST amount, not just the provincial portion.
The rebate is a joint initiative between the Government of Ontario and the Government of Canada, designed to make new homes more affordable and stimulate housing construction across the province. It took effect April 1, 2026 and runs for one year, covering agreements of purchase and sale signed between April 1, 2026 and March 31, 2027.
Key details at a glance
- Coverage: Full 13% HST removed on eligible new homes up to $1 million
- Maximum savings: Up to $130,000 per home (13% of $1M)
- Effective period: April 1, 2026 to March 31, 2027 — one year only
- Who qualifies: All buyers of eligible new construction homes — not just first-time buyers
- Previously: Only first-time buyers could claim the provincial 8% portion; now all buyers get the full 13%
- Pre-construction: APS signed within the window qualifies, even if construction completes later
Who is eligible for the rebate
The HST rebate is available to all buyers of eligible new homes in Ontario, not just first-time buyers. This is a significant expansion from the previous program which restricted the provincial portion to first-time buyers only. There are no income limits, no first-time buyer requirements, and no restrictions on property type — as long as the home qualifies as a new construction and the purchase price is under $1 million.
Eligible buyers include Canadian citizens, permanent residents, and non-residents who meet standard eligibility criteria for purchasing property in Canada. The home must be intended as your primary residence or that of a qualifying relation (spouse, common-law partner, or dependent child). Investors or those purchasing new homes strictly as rental properties may have different rules and should consult with a tax professional.
What types of homes qualify
The rebate applies to newly constructed homes purchased from a builder, including single-family detached homes, semi-detached homes, townhomes, and condominium units, as long as the total purchase price is under $1 million. The home must be substantially new — meaning it has not been previously occupied as a residential property. Renovated homes may qualify in certain circumstances if the renovation substantially changes the property. Mobile homes and floating homes that are affixed to land may also qualify, though specific rules apply.
Resale homes (previously owned properties) are not eligible for the HST rebate since HST does not apply to resale homes in Ontario. The rebate is specifically designed to encourage new construction and reduce the cost differential between new builds and existing homes.
How much can you save?
The savings depend on the purchase price of the new home, up to the $1 million cap. For a home purchased at $500,000, the full 13% HST would be $65,000 — removed entirely under the rebate. For a home at $700,000, the savings are $91,000. For a home at $1 million, the maximum savings of $130,000 apply. Homes priced above $1 million are not eligible for the full rebate, though a partial rebate may still be available on the first $1 million of the purchase price depending on the specific terms.
The one-year window and timeline
The HST rebate applies to agreements of purchase and sale signed between April 1, 2026 and March 31, 2027. This is a firm one-year window — no exceptions or extensions have been announced. For homes that are move-in ready, this means you need to find, negotiate, and sign for a qualifying property within this 12-month period.
For pre-construction homes — which are typically purchased before construction begins — the rules are different. If you sign an agreement of purchase and sale within the April 1, 2026 to March 31, 2027 window, your purchase qualifies even if construction is not yet complete. The builder must begin construction on or before December 31, 2028, and the home must be substantially completed on or before December 31, 2031. This gives pre-construction buyers significant runway while capturing the rebate benefits at the time of signing.
How the rebate is applied
There are two ways the HST rebate is applied to your purchase. In most cases, the builder claims the rebate on your behalf and deducts it directly from the purchase price. This means you pay the reduced price at closing and do not need to handle the paperwork or wait for a refund. The builder includes the HST rebate as part of the purchase agreement and handles the CRA application.
If the builder does not offer this option, you can claim the rebate yourself through the Canada Revenue Agency using Form GST190 (GST/HST New Housing Rebate Application). You will need to submit the application along with supporting documents including your agreement of purchase and sale, proof of closing, and evidence that the home is your primary residence. The CRA typically processes these rebates within 4-8 weeks of receiving a complete application.
Pre-construction buyers: what you need to know
If you are buying a pre-construction home, the timing of your agreement of purchase and sale determines eligibility. As long as you sign within the April 1, 2026 to March 31, 2027 window, your purchase qualifies. Most new homes in Ontario are sold as pre-construction, and developers have begun updating their purchase agreements to reflect the HST rebate. When shopping for a pre-construction home, confirm with the builder or sales representative that the purchase agreement explicitly addresses the HST rebate and how it will be applied to your purchase price.
The builder must still meet the construction timeline requirements — construction must begin by December 31, 2028 and substantial completion must occur by December 31, 2031. If construction is delayed beyond these deadlines, the rebate eligibility could be affected. Make sure your purchase agreement includes protections for this scenario.
How this compares to the previous rebate
Ontario previously offered an HST rebate that covered only the provincial portion (8%) of the HST, and only for first-time home buyers. This meant a first-time buyer purchasing a $700,000 new home could save approximately $56,000 on the provincial portion, but still paid the federal 5% portion ($35,000). The new rebate is dramatically more generous: it covers both the provincial and federal portions (the full 13%), and it applies to all buyers — not just first-timers. A buyer purchasing a $700,000 new home now saves the full $91,000 in HST.
Working with a broker for new construction purchases
A mortgage broker can help you navigate the new construction purchase process, including understanding how the HST rebate affects your mortgage qualification and down payment requirements. Since new construction purchases often have different closing timelines and deposit structures than resale homes, having a broker who understands both the mortgage and rebate landscape is essential. Your broker can also confirm that the builder has properly documented the HST rebate in the purchase agreement and ensure your financing aligns with the closing timeline.
HST rebate on new rental properties
If you are purchasing a new construction home as a rental or investment property, different rules may apply. The GST/HST New Residential Rental Property Rebate allows landlords to claim a rebate on new homes purchased for long-term rental use, subject to specific conditions. The rules for investment properties differ from owner-occupied purchases, so consult with a tax professional or your broker to understand how the rebate applies to your specific situation.
Finding eligible homes
Not all new home listings will explicitly advertise HST rebate eligibility. Working with a real estate agent who specializes in new construction is the most effective way to identify qualifying properties. Builder sales centres and new development websites are also good resources. When inquiring about a new home, ask the builder or sales representative whether the HST rebate has been factored into the listed price or if it will be applied separately at closing.
