Understanding the GST/HST New Housing Rebate: A Guide for Canadian Homebuyers

Who Is This Guide For?

This guide applies to individuals (not corporations or partnerships) who have:

  • Purchased a newly built or substantially renovated property from a builder — including condos, duplexes, mobile/modular homes, and floating homes

  • Built a home on land you own or lease (or hired someone to do it)

  • Undergone a substantial renovation of your existing home (including major additions)

  • Converted a non-residential building into a home

  • Bought shares in a co-operative housing corporation (co-op), giving you primary occupancy rights


📌 Key Note: All owners must be individuals—mixed ownership (e.g., with a corporation) disqualifies you. Partnerships and corporations themselves cannot claim this rebate.


Rental Properties

If your property is meant for rental to others, this guide does not apply. Instead, refer to Guide RC4231 on the GST/HST New Residential Rental Property Rebate.


GST/HST in Quebec

Quebec generally administers GST/HST through Revenu Québec, so if your project is in Quebec, you'll file using their forms—unless you're a Selected Listed Financial Institution (SLFI), in which case, federal filing still applies.


📌 Key Note: SLFIs must file differently. See Revenu Québec’s IN-203 V or call 1‑800‑567‑4692.


 What’s New

• Multiple Buyers (Effective April 19, 2021)

If purchase agreements add unrelated individuals, new rules may impact rebate eligibility. Applies to agreements or construction substantially completed after April 19, 2021.

• Online for Representatives

Registered reps can now share an email during GST/HST NETFILE to receive CRA updates.

• Online Filing for Individuals

Non-business individuals can file rebate forms (GST190, GST191, GST524) via CRA’s My Account—streamlining the process.


Key Definitions

  • Builder: Broadly defined—includes vendors, converters, or individuals in the business of building or renovating for resale.

  • Co-op Housing Corp.: Non-profit housing corporate entity where at least 90% of members are individuals/co-ops, and no individual member has more than one vote.

  • Duplex: A two-unit building under a single legal title—not to be confused with condos.

  • FMV (Fair Market Value): Price a willing, knowledgeable buyer and seller agree upon; excludes GST/HST and land-transfer taxes.

  • Floating Home: Permanently affixed residential structure on water-equipped platform—not a houseboat.

  • Major Addition: A structural enlargement that effectively creates a new house—e.g., adding a second story that doubles living space.

  • Mobile/Modular Home: Factory-built, fully equipped, site-installed homes—not recreational trailers or RVs.

  • Substantial Renovation: At least 90% of interior spaces are removed or replaced (excluding foundational elements and garages).

  • Substantial Completion: Construction progress is ~90%+, under this threshold you may legally inhabit the home.

  • Primary Place of Residence: Must be your (or a relative’s) main, permanent home—not a secondary or seasonal property.

  • Participating Provinces: Provinces harmonized under HST include NB, NL, NS, ON, PE—others (e.g., Quebec) have different rules.

Takeaway

  • Eligibility depends on your activity (buy, build, renovate) and your residency intentions.

  • Ownership structure matters—only individuals can claim.

  • Recent changes (multi-buyer rules, online filing) are designed to reflect modern purchasing scenarios and improve convenience.

  • Understanding terms like “substantial renovation” or “primary residence” is critical to a successful rebate application.


Need To Know?
Consult with your tax advisor or check the full CRA guide RC4028 to see how these definitions apply to your situation—especially regarding eligibility and documentation.

Let me know if you'd like help adapting this for a specific audience like first-time buyers or Quebec residents!


Rebates for New Housing


The GST/HST new housing rebate lets eligible individuals recoup part of the GST or federal HST paid on a new or substantially renovated home used as their—or a relative's—primary residence.


Key Notes:

  • Only individuals qualify—co-ownership with a non-individual, partnerships, or corporations disqualify the claim.

  • Builder-purchased and owner-built properties each follow distinct rebate rules.

Owner-Built Homes


You may claim the rebate if you (or someone you hired) built, substantially renovated, added a major extension, or converted a non-residential property into your home. This also applies to mobile, modular, or floating homes.


Key Notes:

  • “Substantial renovation” means at least 90% of the interior was removed or replaced.

  • Major addition (e.g., full second story) qualifies only when coupled with a substantial renovation.

  • Even non-residential conversions (e.g., offices into homes) count toward eligibility.

Homes Purchased from a Builder


The rebate applies when you buy a new or substantially renovated house or home (including mobile/floating) from a builder, purchase co-op shares, or lease land (20+ years or purchase option) along with the home.


Key Notes:

  • Covers builder-purchased housing or vendor-manufactured homes.

  • Co-ops qualify if taxes were paid by the co-op.

  • Includes properties built on leased land with long-term lease agreements.

Provincial New Housing Rebates


Provincial rebates apply to the provincial portion of the HST in certain provinces, regardless of eligibility for the federal rebate.


Key Notes:

  • Nova Scotia: Offers rebate for new or purchased homes—not for renovations.

  • Ontario: Provincial rebate available for both owner-built and builder-purchased houses.

GST/HST New Residential Rental Rebate


If you're building or renovating to rent the property long-term, you can't use this rebate—but should refer to Guide RC4231, which applies to residential rental properties.


Key Notes:

  • Long-term rental homes are not eligible for this rebate.

  • Guide RC4231 covers the GST/HST new residential rental property rebate instead.

Owner-Built Home Rebate Eligibility


To claim the owner-built rebate, you must:

  1. Build or substantially renovate for use as your (or a relation’s) principal residence.

  2. Have fair market value (FMV) under $450,000 at substantial completion, including land and structures.

  3. Be the first occupant or have made an exempt sale before occupancy.

  4. Pay GST/HST on related land, materials, or services.


Key Notes:

  • Only one claimant allowed in multi-owner builds.

  • Ontario has similar rules, with provincial rebates also applying.

Selling Before Occupancy


If you intended the home to be your primary residence but sold it before occupancy without being a builder or claiming input credits, you may still claim the rebate.


Key Notes:

  • The sale must be exempt (you’re not deemed a builder).

  • Applies if ownership transferred before anyone lived in the home.

Provincial Owner-Built Rebates

Nova Scotia:

  • Owner-built homes in NS may qualify; contact Service Nova Scotia and Municipal Relations.

Ontario:

  • Eligible if federal rebate applies, or FMV exceeds $450k but otherwise meets requirements.

  • Max rebate depends on whether land HST was paid: $24,000 with land HST, $16,080 without.

Renovation, Major Additions & Conversion


Qualifies when substantial renovation, major additions (with renovation), or conversion to residential use occurs.


Key Notes:

  • Substantial renovation requires the 90% interior test—excluding garages, decks, etc.

  • Major addition by itself doesn't qualify—it must accompany renovation.

  • Conversions are automatically treated as substantial renovations—even minimal work can qualify.

Forms and Filing


To apply for an owner-built rebate, you must complete:

  • GST191-WS (Construction Summary Worksheet)

  • GST191 (Rebate Application)

  • For Ontario, add RC7191-ON (Provincial Schedule)

How to file:

  • Send by mail (Sudbury ON or Summerside PEI), or

  • Online via CRA’s My Account

Documentation & Retention


Supporting invoices are only needed when GST/HST wasn’t charged. Originals must be kept for six years. CRA may request proof of occupancy or invoices.


Key Notes:

  • Keep original invoices—photocopies or estimates won’t suffice.

  • Provincial offices will return submitted originals.

Payment Timing & Deadlines


Rebate processing may take up to six months, depending on form completeness and documentation provided.

Filing Deadlines (2 years from base date):

  1. Situation 1: Occupied after completion → 2 years from completion

  2. Situation 2: Sold before occupancy → 2 years from earlier of sale date or completion

  3. Situation 3: Occupied before completion → 2 years from earlier of 2 years after first occupancy or completion

Example:
Build complete Apr 30, 2021; move in May 31, 2021 → file by April 30, 2023.

Late Filings:
Allowed only for owner-built homes if delays are due to extraordinary circumstances (e.g., disasters, illness, CRA error).


Final Thoughts

  • The GST/HST new housing rebate is a valuable benefit for individuals making significant home investments—whether building, renovating, or converting.

  • Strict definitions—FMV thresholds, primary residence intent, and extensive renovations—must be met.

  • Provincial rebates add tone to savings in NS and ON.

  • Proper filing and record keeping are essential for eligibility.


For full details, including forms, instructions, and examples, check out the official CRA guide RC4028 and, if needed, consult a tax professional.