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First-Time BuyersOntario's new-home tax rebate: who actually qualifies
A temporary federal rebate now removes HST on eligible new homes for first-time buyers. It is worth real money, the eligibility rules are narrower than the headlines suggest, and it stacks with two Ontario rebates most buyers never claim.
The short version
- A federal rebate removes the full 13% HST on eligible new homes valued up to $1 million for first-time buyers, with partial relief between $1M and $1.5M.
- It applies to new builds only. A resale home has no HST on the purchase price, so there is nothing to rebate.
- Separately, Ontario refunds land transfer tax up to $4,000 for first-time buyers — and Toronto adds its own up to $4,475.
- "First-time buyer" means neither you nor your spouse has owned a home anywhere in the world. That catches more people than expected.
- The land transfer tax refund must be claimed within 18 months of the transfer. Miss it and it is gone.
What actually changed
There is a version of the first-time buyer conversation that has been the same for a decade, and then there is the version happening in Ontario right now. Two of the three things on this page did not exist in their current form eighteen months ago.
As of 1 April 2026, a temporary expanded federal rebate removes the full 13% HST on eligible new homes valued up to $1 million for first-time buyers, according to the Ontario Budget. Above that, relief tapers — buyers between $1 million and $1.5 million can still qualify for a maximum rebate of $130,000.
That is not a discount on your mortgage. It is tax you do not pay, which changes the cash you need at closing and therefore what you can actually afford.
Who counts as a first-time buyer
This is where files come unstuck, and it is worth being precise because the definition is stricter than the phrase suggests.
Ontario's land transfer tax refund rules require that you are at least 18, that you have never owned a home or an interest in a home anywhere in the world, and — the clause that catches people — that your spouse has not owned one either while they were your spouse.
- A condo you owned briefly in your twenties counts.
- A property inherited and sold counts as an interest in a home.
- A home owned abroad before you moved to Canada counts.
- A spouse who owned a home before you were together generally does not disqualify you — the test is ownership during the marriage.
Get this checked before you write an offer that depends on the money. It is a factual question with a clear answer, and it is far cheaper to answer it in August than at closing.
The three rebates stack
Most coverage treats these as one thing. They are three separate programs with three separate applications, and a buyer in Toronto purchasing a qualifying new build can be eligible for all of them.
- Federal HST rebate — new builds, removes the 13% on eligible homes up to $1 million, tapering to $1.5 million.
- Ontario land transfer tax refund — up to $4,000, which fully covers the provincial tax on a home up to about $368,000 and reduces it above that.
- Toronto municipal rebate — up to $4,475, because Toronto charges its own land transfer tax on top of the province's.
Outside Toronto there is no municipal land transfer tax, so the third does not apply — which is one of several reasons the same house costs meaningfully different amounts to close on in Waterloo Region than in the city.
Buyers of homes priced between $1 million and $1.5 million can still qualify for the maximum rebate of $130,000.— Ontario Budget 2026, on the expanded new-home rebate
The deadline nobody mentions
A first-time buyer land transfer tax refund must be claimed within 18 months of the transfer. Most buyers claim it at closing through their lawyer and never think about it, which is exactly why the ones who don't tend to forget entirely.
If your lawyer claimed it for you, it appears on your statement of adjustments. If it does not appear there, you have eighteen months to claim it directly — and after that, nothing.
What this changes about your budget
Closing costs are the part of buying that people consistently underestimate, and land transfer tax is usually the largest single line in them. Removing or reducing it does not change your mortgage — it changes how much cash you need on the day, which is often the actual constraint.
For a first-time buyer looking at a qualifying new build, the combination can move the amount of cash required at closing by a substantial margin. Whether that means you buy sooner, buy differently, or simply keep a larger cushion afterwards is a planning question rather than a mortgage one.
The useful exercise is to model your closing costs both ways — with the rebates and without — before you decide what you are shopping for. Our purchase and land transfer tax calculators will do both.
Nearly thirty years in Canadian financial services, based in Waterloo Region and working across Ontario. Most people are handed a product — you deserve a plan.
General information, not tax or legal advice, and not an offer of credit. Rebate programs, thresholds and eligibility rules are set by government and change; every figure here is accurate as at the date of publication and linked to its source. Confirm your own eligibility with your lawyer or accountant before relying on it. Any mortgage application is subject to lender approval and satisfactory review of credit, income and property.
Sources: Ontario Budget 2026 — HST relief on new homes · Ontario — Land transfer tax refunds for first-time homebuyers · Canada Revenue Agency — First-time home buyers' GST/HST rebate