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Do I have to pay HST when buying a home?

January 10, 2010 · 11 comments

HST Tax

One of the most frequent questions I get from clients is about the upcoming Harmonized Sales Tax (HST) and how it will affect the purchase of a home.  Here is the breakdown of the rules:

When does the HST take effect?

July 1, 2010.

How much tax will I be paying in total?

13% (That’s 5% GST + 8% PST).

I’m buying a resale home, so will I have to pay this HST?

Good news!  The answer is NO!  If you’re buying a resale home, you simply pay the purchase price as usual.

I’m thinking of buying a new home from the builder, so will I have to pay this HST?

Ouch, yes you do!

But wait, I heard there is some sort of rebate program in place if I bought a brand new home?

The Province is proposing a rebate so that new homes across all price ranges would receive a 75 per cent rebate of the provincial portion of the single sales tax on the first $400,000. For new homes under $400,000, this would mean, on average, no additional tax amount compared to the current system.

Is there anything else that I would have to pay HST on?

Unfortunately, they’re hitting you everywhere.  You’ll be paying HST on legal fees, moving costs, home inspection fees, and real estate commissions.

Where can I find out the full details of this tax and how it works?

You can read all the exciting details right here.

{ 11 comments }

This post has 11 comments
  • Adam
    Hello My closing date is on July 24, 2010. However, house agreements of purchase and sale were done back on Aug. 2009. The sale price of the new home is $330,000. Do I have to pay HST?

  • nanette ouimette
    Hi I am very concerned about the hst and now wondering if I have been had I purchsed a home for a price of 450,000 closing date is july 5 2010 the home is 30 yrs old please reply very nervous ....thank you 9 i have already paid in full )

Am I eligible for a land transfer tax refund?

March 2, 2008 · 11 comments

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There seems to be a lot of confusion going around these days regarding new land transfer tax changes. In this previous article, I highlighted the new changes to land transfer taxes in the City of Toronto, as well as provided a land transfer tax calculator.

The Land Transfer Tax Refund Program for first-time home buyers has been expanded to include purchases of resale homes. If you’re a first time purchaser of a RESALE home and your Agreement of Purchase and Sale was registered after December 13, 2007, you are entitled to receive a refund of up to $2,000 of the land transfer tax paid. As these proposed amendments to the Land Transfer Tax Act are still pending by the Ontario Legislature, you can either wait until it becomes law or send in the required documents first and have them held pending Royal Assent of the proposed amendments.

Here are the documents you will need to get your refund:

  1. Copy of Agreement of Purchase and sale
  2. Copy of Docket Summary (to show payment)
  3. Copy of Registered Transfer
  4. Land Transfer Tax Refund Affidavit

Mail these forms to:

Ministry of Revenue
Tax Compliance and Regional Operations Branch
Land Taxes Section
33 King Street West
P.O. Box 625
Oshawa, Ontario L1H 8H9

If you’d like more information, you can visit the official website for more details.

{ 11 comments }

This post has 11 comments
  • Ty
    hello, i recently purchased a home in Ontario, my question is, i purchased it with my girlfriend who have never lived with, and because we just qualified by the minimum my father co-signed but they wanted him on the mortgage as well for money reasons, but he is single and has been for some time but owned a condo back in the early 80's would we all still qualify for first time home buyers and get the land transfer deducted? or would we have to pay it? we own 95% of it and father only 5%.

  • Ken
    Let say all my investments (rental properties) are not under my name, am i still eligible for this refund as i'm carrying numerous mortgages for these rental properties (that are not under my name)? so officially, i do not own any homes, i'm just paying for them.