Published 7 September 2026 · By Jatin Dua, Broker of Record, RE/MAX Quantum Realty
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Get My Free Estimate →If you are a first-time buyer of a brand-new home priced at $1,000,000 or less, the federal government now rebates the full 5% GST — up to $50,000. Between $1,000,000 and $1,500,000 the rebate shrinks on a sliding scale, and at $1,500,000 it disappears entirely. You must have signed your agreement after 26 May 2025, and you must be the first person to live in the home.
What the rebate actually is
When you buy a resale home in Ontario there is no GST or HST on the purchase price. When you buy a new home from a builder, there is — and on a new build in Ontario that means 13% HST, of which 5% is the federal GST portion and 8% is the provincial portion.
The First-Time Home Buyers’ GST Rebate, introduced in 2025, gives first-time buyers that federal 5% back. On a $1,000,000 new home the GST is $50,000, so the rebate is worth the full $50,000. That is not a deduction or a credit against future tax. It is money that comes off what you owe on closing.
This sits on top of the older GST/HST New Housing Rebate that already existed, and you have to meet the requirements of that older rebate too — chiefly that the home is your primary residence and that you are the first person to occupy it.
Who counts as a first-time buyer here
The definition is stricter than most people assume, and it is not the same definition used by the Ontario land transfer tax rebate. To qualify you must be at least 18, a Canadian citizen or permanent resident, and you must not have owned a home you lived in as your principal residence during the current calendar year or in any of the four calendar years before it.
- You are 18 or older on the day the agreement is signed.
- You are a Canadian citizen or a permanent resident.
- You have not owned and lived in a principal residence in the calendar year or the four preceding calendar years.
- You are buying the home to live in as your primary residence.
- You are the first person to occupy the home once construction is finished.
The $1M to $1.5M phase-out, in real numbers
Below $1,000,000 the relief is complete. Above $1,500,000 there is none. In between, the rebate falls away on a straight line, so every extra dollar of price costs you rebate as well as purchase money.
| Purchase price | Federal GST at 5% | Rebate you receive | Net GST you pay |
|---|---|---|---|
| $800,000 | $40,000 | $40,000 | $0 |
| $1,000,000 | $50,000 | $50,000 | $0 |
| $1,250,000 | $62,500 | $25,000 | $37,500 |
| $1,400,000 | $70,000 | $10,000 | $60,000 |
| $1,500,000 | $75,000 | $0 | $75,000 |
Why the $1M line matters more than it looks
A $1,050,000 home and a $1,000,000 home are $50,000 apart on paper. After the rebate phase-out they are closer to $55,000 apart in real cost. If you are negotiating a pre-construction price near the line, that is a genuine argument to bring to the builder.
The deadlines that decide everything
This is a temporary programme with hard dates built into it, and the dates run on the agreement, not on your closing.
- Your agreement of purchase and sale must be entered into after 26 May 2025. An agreement signed on or before that date does not qualify, no matter when you close.
- The agreement must be entered into before 2031.
- Construction must begin before 2031.
- The home must be substantially completed and ownership transferred to you before 2036.
What this means if you are buying pre-construction in the GTA
Most pre-construction purchases in Toronto and the 905 close three to five years after the agreement is signed. That long gap is exactly why the completion deadline of 2036 exists, and for anything selling today it is unlikely to bind. The date that will bite is the 26 May 2025 agreement date — if you signed on an assignment or took over an earlier purchaser’s contract, look carefully at which agreement the CRA will treat as yours.
It is also worth remembering the state of the market you are buying into. Through the first quarter of 2026 there were no new condominium project launches across the GTHA, 246 new condo sales, and a record 4,295 unsold completed units sitting in inventory. New product was priced around $1,189 per square foot against roughly $859 for resale — a gap of about 38%. A $50,000 rebate is real money, but it does not close a gap that size on its own.
Common questions
Do I get this on a resale home?
No. There is no GST or HST on the purchase price of a resale home in Ontario, so there is nothing to rebate. This applies to new construction bought from a builder, and to substantially renovated homes that the tax rules treat as new.
Does my spouse also have to be a first-time buyer?
This is one of the areas where the detail matters and the answer depends on how the purchase is structured and who is on title. Take specific advice before you sign rather than assuming.
Is the 8% Ontario portion rebated too?
This programme is the federal 5% GST portion. Ontario has its own new housing rebate on the provincial portion, with its own rules and its own maximum. They are separate — check both.
How do I claim it?
In practice, on a new build the builder usually credits the rebate against the purchase price on closing and claims it back, which means you never lay out the money. Your agreement will say whether that is happening. If it is not, you claim it afterwards from the CRA.
What if the price is exactly $1,500,000?
At $1,500,000 the rebate is fully eliminated. You would pay the full federal GST portion.
Buying new in the GTA and unsure where you stand?
I will walk through your agreement, the dates, and whether the rebate is being credited on closing or claimed afterwards — before you commit to anything.
Ask me about your purchase or call or text 437-987-1925.
Related reading
- Ontario and Toronto land transfer tax calculator
- First-time home buyer guide for Etobicoke
- Pre-construction condos and homes in the GTA
- How much mortgage can you afford?
- PwC Canada, Tax Insights: GST relief for first-time home buyers on new homes valued at up to $1.5 million.
- Canada Revenue Agency guidance on the GST/HST New Housing Rebate.
- Urbanation and Bullpen reporting on GTHA new condominium launches, sales and unsold inventory, Q1 2026.
Jatin Dua is Broker of Record and co-founder of RE/MAX Quantum Realty, Brokerage, Unit 101, 799 The Queensway, Etobicoke. Four-plus years in the GTA and more than $100M in sales volume.
This article is general information about a federal tax programme, not tax or legal advice. Rebate rules, thresholds and deadlines change. Confirm your own eligibility with an accountant or a real estate lawyer before relying on any figure here.