First Time Buyers
There are 4 programs for the First Time Buyers.
1) Home Buyer Tax Credit (HBTC) (up to $750)
You can receive up to $750 back from the federal government by applying for the home buyer tax credit in the year the home was purchased. To obtain the tax credit, complete line 369 on your personal income tax return.
You will qualify for the HBTC if:
• You, your spouse or common-law partner acquired a qualifying home; and
• You did not live in another home owned by you or your spouse or common-law partner in the year of acquisition or in any of the four preceding years.
If you buy a house, with a spouse or common-law partner, either one of you can claim the credit or you can share the credit. However, the total of your combined claims cannot exceed $750. You must occupy the home as your principle residence no later than one year after the home was purchased.
2) RRSP Plan (up to $25,000)
The First Time Home Buyers RRSP Plan (HBP) allows first time home buyers to withdraw up to $25,000 from RRSPs to buy or build a home for yourself or for a related person with a disability. The withdrawn amount must be repaid within 15 years, subject to a minimum annual repayment that is 1/15 of the amount withdrawn. If the full $25,000 is withdrawn, the minimum annual repayment is $1,667. If less than the minimum is repaid in any particular year, the balance is added to the taxpayer’s income. To qualify for the Home Buyers Plan, an individual must not have not owned a home during the last 4 full calender years.
3) Ontarion Land Transfer Tax Credit (up to $8,475)
The Land Transfer Tax Credit is a refund of the cost of the provinces land transfer tax up to a maximum of $8,475 if the buyer purchased a home in Toronto or $4,000 for the home not in Toronto. This will allow first time home buyers to purchase a home up to $400,000 without having to pay any land transfer fee. Any amount higher than $400,000 is taxed a rate of approximately 1.5%. To qualify the property must be owner occupied. The first time home purchaser may claim the full maximum amount or a proportion of the maximum refund amount. To qualify for the Land Transfer Tax Credit, you cannot have ever owned a home, or an interest in a home, anywhere in the world. The refund can be given instantly at the lawyers office but advise the lawyer prior to the closing date if you qualify for the rebate
4) New program to help 100,000 Canadian families buy their first home
- The First-Time Home Buyer Incentive, administered by the CMHC, would help eligible Canadians with a household income under $120,000 per year afford to buy their first home.
- Through the new Incentive, the CMHC would provide 5 per cent of the value of a home for a first-time homebuyer through a shared investment.
- To encourage the construction of new housing supply, the Incentive would increase to 10 per cent for a newly-built home.
- Additional information about the First-Time Home Buyer Incentive will be released by CMHC later this year.
- Budget 2019 also proposes to increase the Home Buyers’ Plan withdrawal limit from $25,000 to $35,000, providing first-time home buyers with greater access to their Registered Retirement Savings Plan savings to buy a home.
- In 2017, the Government of Canada announced a 10-year, $40 billion National Housing Strategy that will help reduce homelessness and improve the availability and quality of housing for Canadians in need. The Strategy sets clear goals to remove 530,000 Canadians from housing need and reduce chronic homelessness.