Are you excited to purchase your first home? You should be! It marks the beginning of a new chapter in life and is one of the biggest purchases you will make in life. You should also be excited to know that the federal government introduced the First-Time Home Buyers’ Tax Credit as part of “Canada’s Economic Plan” in 2009 to help Canadians in purchasing their first home. The following link provides more details: First Time Home Buyer’s Tax Credit
Some provinces and cities also have tax credits open to first time home buyers to attract them to their city.
The City of Toronto has a Municipal Land Transfer Tax where first time home buyers may receive a rebate of up to $3,725. More information can be found at: City of Toronto Land Transfer Tax.
The Government of British Columbia and Nova Scotia also offers programs for first time home buyers.
Canada Wide First-Time Home Buyers’ Tax Credit (HBTC)
A tax credit of $5000 multiplied by the lowest federal income tax rate for the year, is available as a non-refundable tax credit. In 2013, the lowest rate is 15 percent so the HBTC available is $750. This is presently available to all first time owners. The tax credit must be claimed on your income tax under line 369 on your tax return of the year you purchased your home.
Are you eligible?
You must meet the following requirements to be eligible:
- If you are purchasing a home with your spouse, common-law partner or friend, the purchase must be a qualifying home that is registered under either person’s name
- Either person can claim the credit or share it however the combined total cannot exceed $5000
- Any buyer that has not owned a home in the past four years prior to the home purchase for 2013 it would be since 2008
- neither you nor your spouse or common-law partner owned and lived in another home in the year of purchase or any of the four preceding years.
Your home must meet the following requirements to be eligible:
- Located in Canada
- Be an existing or new home
- Be a townhouse, semi, single, mobile home, condo or apartment
- The person applying for the credit must intend to occupy the home within one year of purchase
To find out more: Government of Canada 2018 Budget