New construction
New-home HST and the available rebates
By Bo Yu, Broker, Right at Home Realty, Brokerage · Verified/updated August 2026
HST at 13% applies to newly built and substantially renovated homes in Ontario. It does not apply to resale homes at all.
Almost every builder advertises a price that already includes HST net of the rebates, on the assumption that you will live in the home and assign the rebates to them. If that assumption fails — you're buying to rent, or you don't qualify — the builder charges the rebate amount back to you at closing, and it is a large number.
As of March 2026 there is also a first-time home buyers' GST/HST rebate in force for new builds, on top of the long-standing rebates.
- Who charges it
- The Canada Revenue Agency, collected by the builder.
- Who normally pays
- The buyer of a new or substantially renovated home.
- When it's paid
- At closing, normally embedded in the purchase price via assigned rebates.
- Cash or financed
- Embedded in the price and therefore financed when the rebates are assigned. Where a rebate is clawed back, that portion becomes cash at closing.
- Typical range
- Usually $0 extra when the price is HST-included and rebates are assigned
How it's calculated — and why it varies
Three separate rebates can apply. They stack in the sense that the Ontario rebate applies to the provincial portion and the federal rebates to the federal portion.
- Ontario new housing rebate: 75% of the 8% provincial portion, capped at $24,000. Effectively available at any price, because the cap bites first.
- Federal new housing rebate: 36% of the 5% federal portion, full up to a $350,000 fair market value, phasing out to nil at $450,000 — which excludes most Ottawa new builds.
- First-time home buyers' GST/HST rebate (Bill C-4, in force since March 2026): up to 100% of the federal GST on a new home priced under $1,000,000, phasing down to nil at $1,500,000, for buyers who qualify as first-time buyers and meet the transitional dates.
- FTHB rebate conditions include an agreement of purchase and sale signed on or after March 20, 2025 and before 2031, construction starting before 2031 and substantially completed before 2036, ownership transferring before 2036, occupying the home as your primary residence, and being the first occupant.
- Ontario's 2026 budget proposed broader provincial HST relief on new homes up to $1.85M. That is proposed and awaiting federal implementing regulations — do not budget on it as law.
Exemptions, refunds and when it doesn't apply
- Resale homes: no HST on the purchase price at all.
- Buying a new home to rent out: you cannot assign the new housing rebate to the builder; you pay the rebate amount at closing and apply separately for the new residential rental property rebate.
- Assignment sales and pre-construction flips have their own HST treatment and can create tax on the assignment profit — get accounting advice.
- "First-time buyer" for the federal GST rebate means you and your spouse haven't lived in a home you owned in the current or previous four calendar years — a different test than Ontario's land transfer tax refund.
- You and your spouse can only ever receive the FTHB GST/HST rebate once.
A real Ottawa example
A $750,000 HST-included new townhome in Barrhaven bought as a primary residence: the builder collects the Ontario and federal rebates by assignment, and the buyer sees no separate HST line at closing.
The same $750,000 home bought as a rental: the buyer cannot assign the rebate, and the builder charges the rebate amount — roughly $24,000 of Ontario rebate plus the federal portion — as cash at closing, recoverable later by filing for the rental rebate.
How this shows up in the calculator
Because builder prices in Ottawa are almost always quoted HST-included with rebates assigned, the calculator treats your entered price as the all-in price and does not add a separate HST estimate. If your agreement is HST-extra, or you're buying to rent, ask your lawyer for the exact figure rather than estimating — the assumptions move the answer by tens of thousands of dollars.
Open the calculatorCommon questions
- Do I pay HST on a resale home in Ottawa?
- No. HST applies to new and substantially renovated homes only. Resale purchases carry no HST on the price.
- Is the new first-time buyer GST rebate actually law?
- Yes. It received Royal Assent in March 2026 and CRA began accepting applications the same month. The separate Ontario proposal to extend provincial relief to $1.85M homes is not law.
Official sources — verified/updated August 2026
Rules and rates change. These are the first-party pages this one was checked against; confirm anything that matters to your purchase directly with them.
Every figure on this page is a planning estimate for general information only, based on the assumptions shown, and are not legal, tax, mortgage or financial advice or an offer of credit. Actual rates, payments, taxes, fees and values vary — confirm the numbers with your lender, lawyer or accountant before relying on them. Full disclosures.
This page is general information about how a cost works in Ontario, not legal, tax, mortgage or accounting advice, and not a quote. Your lawyer, lender and accountant confirm what actually applies to your purchase.
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