Ottawa has eliminated the GST on new homes
Ottawa has eliminated the GST on new homes

Good news for those dreaming of their first new home! Since March 12, 2026, Bill C-4 has received royal assent: first-time buyers of a new home can now recover the full GST (5%) on their purchase, provided it is worth less than one million dollars. Rebate applications are now being accepted by the CRA — and by Revenu Québec for homes located in Quebec.

 

Goodbye GST for first-time buyers

The federal government has eliminated the GST (5%) for first-time buyers of a new home under one million dollars. For those aiming higher, the rebate gradually decreases for properties between 1 and 1.5 million dollars.

Concretely, this represents savings of up to $50,000 on the purchase of a new home — enough to make a big difference in the budget!

The measure applies retroactively to contracts concluded as of March 20, 2025. The initial date of May 27, 2025 was moved up upon adoption of Bill C-4, following a recommendation from the APCHQ.

Eligibility criteria to be a first-time home buyer

To benefit from this rebate, you must be considered a first-time home buyer, which means:

  • Being at least 18 years old
  • Being a Canadian citizen or permanent resident of Canada
  • Not having lived in a home that you owned (or that your spouse/common-law partner owned) during the calendar year or the four preceding calendar years, whether in Canada or abroad
  • Being the first occupant of the home after construction work
  • Not having already received a GST/HST rebate for first-time buyers (and neither has your spouse/common-law partner)

Other rules and limits must also be validated; for this, consult the CRA page whose link appears at the bottom of this article.

Types of eligible homes

The rebate applies to:

  • New homes purchased from a builder (house, land and building)
  • Homes built by the owner or by a hired contractor
  • Shares in a housing cooperative
  • New mobile or floating homes
  • Homes that have undergone major renovations (at least 90% of the interior replaced)

Note: resale homes are not eligible, since they are exempt from GST — there is therefore no tax to rebate. The rebate is exclusively for new construction or major renovations.

Price limits and rebate amounts

Home valueGST rebate

Up to $1,000,000 100% of GST (up to $50,000)
$1,000,001 to $1,499,999 Progressive reduction (e.g.: $25,000 for a home of $1,250,000)
$1,500,000 and more No rebate

This rebate is in addition to the existing GST/HST new housing rebate, which covers up to 36% of the GST paid (maximum of $6,300) for properties of $450,000 and less. For first-time buyers eligible for both rebates, the new rebate acts as a complement to the existing rebate, for a combined relief of up to 100% of the GST.

Time requirements

To be eligible, purchases must meet strict deadlines:

For homes purchased from a builder:

  • Sales contract concluded on or after March 20, 2025, and before 2031
  • Construction started before 2031
  • Construction substantially completed before 2036
  • Property transferred before 2036

For owner-built homes:

  • Construction or renovations started on or after March 20, 2025, and before 2031
  • Work substantially completed before 2036

Important: buyers who concluded a contract between March 20, 2025 and March 12, 2026 (date of royal assent) and whose property has already been transferred must apply for the rebate directly with the CRA — or with Revenu Québec for homes in Quebec. The builder could not credit the rebate before royal assent. You generally have two years from the property transfer or completion of work to submit your application.

Current rebates remain in place

Rest assured, existing rebates are not disappearing! For those who are not first-time buyers, the GST/HST new housing rebate remains in effect (up to $6,300 for properties of $450,000 and less). And for eligible first-time buyers, the new rebate is automatically added — the two combine for maximum coverage.

The CRA has been accepting rebate applications since March 17, 2026 via form GST190 (homes purchased from a builder) or GST191 (owner-built). In Quebec, it is Revenu Québec that administers these rebates — applications must be made with Revenu Québec using its own forms, even though it is a federal measure.

Builders can now credit the rebate directly to eligible buyers at the closing of the sale, as is already common practice for the existing GST/HST new housing rebate.

What about the provinces?

The federal rebate only covers the GST (5%). What about the provincial portion of sales taxes?

Ontario opened the ball: in October 2025, the Ontario government announced a rebate of the 8% provincial portion of the HST to eligible first-time buyers, according to the same criteria as the federal rebate. Combined, the two rebates could represent up to $130,000 in savings in Ontario.

In Quebec, the QST (9.975%) is not covered by an equivalent measure at this time. The existing QST new housing rebate remains in effect, but no enhanced rebate for first-time buyers has been announced by Quebec. This is a file to watch.

This temporary measure, which applies to contracts concluded between March 20, 2025 and the end of 2030 and to construction completed before 2036, marks an important turning point in government assistance for home ownership. First-time buyers who were hesitating between new and resale now have a strong argument in favor of new construction.

The industry continues to advocate for an expansion of the rebate to all buyers — not just first-time buyers — in order to further stimulate the supply of new housing. To be continued.

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