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First-Time Home Buyer’s GST Rebate: What Your Family Needs to Know

A new proposed GST/HST First-Time Home Buyers Rebate could slash up to CAD 50,000 off the cost of a newly built home. Here’s eligibility, timelines, and what that means for planning your purchase.

By NomadicTax Research Team · 5-8 min read

Overview: What Is the FTHB GST/HST Rebate?

  • Proposed as part of Budget 2025, this federal rebate aims to eliminate GST (or the federal portion of HST) for first-time home buyers purchasing newly built homes valued up to CAD 1 million, and reduce it for homes valued between CAD 1 million and CAD 1.5 million.(canada.ca)
  • Maximum rebate: CAD 50,000. Above CAD 1.5 million, homes aren’t eligible.(canada.ca)

Eligibility Criteria

Choose a plan based on your home type:

  • Buying from a builder, building on leased or owned land, or in a cooperative housing setup.(canada.ca)
  • Must be a first-time home buyer: at least 18 years old, Canadian citizen or permanent resident, and not have lived in a home owned by you or your spouse/common-law partner in the year of purchase or four preceding years.(canada.ca)
  • If you’ve claimed this rebate once before, you can’t again. Construction must begin after May 27, 2025, and substantial completion before 2036. Agreements must also be signed before 2031.(canada.ca)

Timing & Status

  • The measure is proposed legislation in Bill C-4 and expected to require Royal Assent to take effect.(canada.ca)
  • Application forms and guides aren’t yet available. Claims can’t be processed until after the change is law.(canada.ca)

Practical Example

Suppose Ana is a first-time buyer and purchases a new home from a builder for CAD 1,250,000, with ownership transferred in 2025. Under the proposed rebate:

  • Homes up to CAD 1 million get 100 % GST relief → full rebate of CAD 50,000.
  • Homes between CAD 1M-1.5M get partial rebate: roughly proportional phased-out (at mid-point, like at CAD 1.25M, about 50 % of maximum, i.e. CAD 25,000).(canada.ca)

How to Prepare & Plan

  • If you're house hunting, consider new builds vs resale—this rebate only applies to newly built or substantially renovated homes.(canada.ca)
  • Time your agreement of purchase to be on or after May 27, 2025 and aim to have occupancy and construction timeline comply. Delays could disqualify.(canada.ca)
  • Since this is federal GST (or federal portion of HST), check the provincial portion separately—rebates don’t affect provincial/HST levies directly.
  • Talk to your builder or tax advisor to understand how the GST is included in the purchase price and how to apply once forms are available.

Considerations & Risks

  • Provincial HST parts aren’t covered unless you live in HST participating provinces with different regimes.
  • Price volatility could push a home slightly above eligibility thresholds.
  • Pending legislation means details could shift—stay updated.

Bottom Line

If you're looking to jump into homeownership with a new build, this rebate could offer substantial upfront savings. Proper structuring and timing can help you capture the full benefit when the law is in place.

Sources

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