If you’re purchasing a newly built home, building your own, or substantially renovating an existing one for the first time in Canada, the federal government has a rebate that could put up to $50,000 back in your pocket. Here’s everything you need to know about what the First-Time Home Buyers’ GST/HST Rebate is and how to benefit from it.
What It Is
When a builder sells a newly built home, GST or HST is charged on the sale, which can add tens of thousands of dollars to the cost of an already expensive purchase. The first-time buyer rebate exists specifically to offset that tax burden.
The Existing GST/HST New Housing Rebate
Before the First-Time Home Buyers’ GST/HST Rebate existed, Canada already had a GST/HST New Housing Rebate available to anyone (not just first-time buyers) purchasing or building a new home as their primary residence. It’s still available today, and it’s worth understanding first, because the two rebates work together.
The original rebate returns 36% of the GST or federal portion of HST you paid on a new home, up to a maximum of $6,300. The catch is that it was designed long before today’s housing prices and hasn’t kept pace with them. It phases out entirely once a home’s market value reaches $450,000, meaning the majority of new homes built in Canada today receive a reduced benefit or none at all.
The New First-Time Home Buyers’ GST/HST Rebate
The First-Time Home Buyers’ GST/HST Rebate was introduced in 2025 to address the gap left by the older rebate. For eligible first-time buyers, it eliminates the GST or federal portion of HST entirely on homes valued up to $1 million, and partially reduces it on homes valued between $1 million and $1.5 million.
The maximum benefit is $50,000. The rebate works on a sliding scale based on the value of your home:
Homes valued at $1 million or less: you can recover up to 100% of the GST/HST paid, to a maximum of $50,000.
Homes valued between $1 million and $1.5 million: the rebate is gradually reduced. A home at exactly $1.25 million, for example, would be eligible for $25,000 (50% of the maximum).
Homes valued at $1.5 million or more: no rebate is available.
How the Two Rebates Work Together
If you qualify for both rebates, the First-Time Home Buyers’ GST/HST Rebate acts as a top-up to the general rebate program. You don’t receive both in full; rather, the new rebate covers what the existing rebate doesn’t. The combined amount cannot exceed the total GST/HST you actually paid.
Here’s an example: A first-time buyer in Nova Scotia purchases a newly built home for $420,000. At Nova Scotia’s current HST rate of 14%, the federal portion works out to $21,000 in federal tax paid (5% of $420,000).
Under the existing GST/HST New Housing Rebate, a home at this price sits in the phase-out range between $350,000 and $450,000, so the buyer receives a reduced rebate of approximately $2,520 rather than the full $6,300 maximum.
The First-Time Home Buyers’ GST/HST Rebate then tops that up. Because the home is valued well below $1 million, the buyer is entitled to recover up to 100% of the federal tax paid, which was $21,000. The new rebate covers the remaining $18,480 that the existing rebate didn’t.
In total, the buyer recovers the full $21,000 in federal tax, split across both rebates, rather than just the $2,520 they would have received before the new rebate existed.
Dates You Need to Know Upfront
This rebate applies to first-time homebuyers purchasing newly built homes, substantially renovated homes, and owner-built homes. It does not apply to resale homes being purchased as-is.
The program has a timeline attached, and the key dates vary slightly depending on your situation.
- If you purchased from a builder, your purchase agreement must have been signed on or after March 20, 2025, and before 2031.
- If you built or substantially renovated the home yourself, construction must have begun on or after March 20, 2025, and before 2031.
In both cases, the work must be substantially completed before 2036.
Who It’s For
The First-Time Home Buyers’ GST/HST Rebate has eligibility requirements that go beyond the existing GST/HST New Housing Rebate.
The existing rebate is available to anyone buying or building a new primary residence, regardless of whether they’ve owned a home before.
The FTHB rebate adds a layer on top of that: you must meet the CRA’s definition of a first-time home buyer, and you must personally occupy the home as your primary residence.
The First-Time Home Buyer Definition
Despite the name, “first-time home buyer” under CRA rules doesn’t mean you’ve never owned a home in your life. It means you haven’t lived in a home you (or your spouse or common-law partner) owned as a primary residence during the current calendar year or the four calendar years before the qualifying date.
To qualify as a first-time home buyer, all of the following must be true:
- You are at least 19 years old.
- You are a Canadian citizen or permanent resident.
- Neither you nor your spouse or common-law partner has lived in a home you (or they) owned as a primary residence at any point during the current calendar year or the four calendar years before your qualifying date.
- Neither you nor your spouse or common-law partner has previously received the FTHB rebate.
The four-year lookback is worth paying close attention to. If you sold a home you owned in 2022 and are taking ownership of a new home in 2026, you would not qualify, because 2022 falls within the four-year window.
If you took ownership in 2027 instead, you likely would qualify. The year you take ownership is what determines which four years get checked.
Your qualifying date depends on your situation. If you purchased from a builder, it’s the date ownership transfers to you. If you built or substantially renovated the home yourself, it’s whichever comes first: the date you first occupied the home, or the date construction was substantially completed.
What You Must Be Buying or Building
You also need to be purchasing or building a home that will be your own primary place of residence. Unlike the existing rebate, which allows a family member to occupy the home on your behalf, the First-Time Home Buyers’ GST/HST Rebate requires that you personally live there and that you are the first person to occupy the home after construction or renovation is substantially complete.
The rebate is available for:
- A newly built or substantially renovated home purchased from a builder, including on leased land if the lease is 20 years or longer or gives you the option to buy
- A home you built or substantially renovated yourself, or hired someone to do on your behalf
- A share in a co-operative housing corporation (co-op), for use as your primary residence
Investment properties, vacation homes, and cottages do not qualify.
How to Apply
How you apply depends on how you’re getting your home.
If you purchased from a builder:
Your builder may pay or credit the rebate directly to you at closing, which means the paperwork flows through them. You’ll still sign Form GST190, but the builder submits it to the CRA.
If the builder doesn’t credit you at closing, you file the application yourself and have up to two years from the date ownership was transferred to do so.
If you built the home yourself:
You’ll need to complete Form GST191-WS (a construction summary worksheet) and Form GST191 (the rebate application for owner-built homes). You can file both online through your CRA My Account or mail them to the appropriate tax centre. The two-year filing window starts from the date construction is substantially completed or the date you first occupied the home, whichever applies to your situation.
In both cases, keep all your original documents for six years: purchase agreements, invoices, proof of occupancy, and completed forms. The CRA audits rebate claims, and you’ll need the paper trail.
Once submitted, expect a wait of up to six months for payment. Your rebate can be delayed or denied if the forms are incomplete, the calculation is wrong, or required documents are missing, so it’s worth taking your time to get it right.
How The First-Time Buyer Rebate Affects Your First Tax Season as a Homeowner
If you’re still in the planning stage and haven’t bought yet, understanding the rebate now can genuinely change how you budget for your first year of homeownership.
The GST or HST on a new home adds up fast. On a $700,000 new build in Nova Scotia (where HST is 14%), the federal portion of that tax alone could be over $35,000. A full rebate on a home in that price range wipes out most or all of that cost.
What that means practically: if your builder is crediting the rebate at closing, your out-of-pocket costs at the time of purchase are already reduced. You don’t have to pay the full tax and wait to be reimbursed. That changes your cash flow math significantly when you’re putting together a down payment and closing cost budget.
If you are filing for the rebate yourself after closing, the money arrives separately, often months later. Budget as though you won’t see it right away, and treat it as a reimbursement rather than funds you can count on at the moment you need them.
Also worth knowing for tax season: this rebate is not taxable income. You don’t report it on your T1. It’s a return of tax you already paid, not a benefit or credit applied against your income.
If your situation is at all complicated (a co-op purchase, a self-build, a lease arrangement, or a purchase agreement signed in that March-to-May 2025 window), it’s worth calling the CRA’s GST/HST Rulings line at 1-800-959-8287 before filing. Getting it right the first time saves a lot of headaches later.
If you’re interested in looking for new builds in Nova Scotia, let’s book a call to chat about how this affects your budget.
