Any homeowner understands the financial burden of acquiring or fixing-up a home. However, Canada has begun a new program to help offset these costs, particularly the costs incurred through taxes. The “GST/HST New Housing Rebate” rebates some of the money taken from the goods and service tax (GST) and the harmonized sales tax (HST), sometimes as much as $42,000! The amount rebated ultimately depends on numerous factors, including the cost of your home and the cost of renovation, and varies from person to person. Nevertheless, homeowners can get a lot of money back.
Eligibility for this rebate requires that homebuyers meet a number of criteria, and it can get confusing to determine if you meet these criteria. However, once you get the fundamentals and understand the terms, it is really quite easy to understand.
The two primary criteria that determine eligibility for the rebate are:
- The house being built or renovated is or will be your primary place of residence.
- Applicants apply within two years of completion of construction or renovation.
Recipients of the rebate should expect a non-taxable payment from the CRA within 4 to 16 weeks of submission.
Notes about Home Renovation.
- Home additions, as well as conversion of a non-residential property to a residential property, are considered renovations.
- Neither the overall cost of renovation nor the value added to the home are included in calculations of renovation rebate. Renovation rebates are determined by the areas of the home affected.
- Renovations that were covered by insurance, such as renovations after a flood or fire, are also eligible for the rebate.
Many new homeowners often miss this rebate, partially because the government doesn’t do much to publicize it. In fact, be careful not to confuse this rebate with other rebates and tax credits. However, this rebate is a tremendous opportunity to get some of your money back, which is a major bonus in the often pricey process of acquiring your home.
Do some research, but if you find yourself interested, talk to an expert to determine your eligibility and course of action.