A buyer who is not a first-time home buyer signed an agreement in June 2025 to buy a new condominium unit in Ontario from a builder for $500,000 before tax, as a primary residence. What is the HST, and what new housing rebate is available?
Correct Answer
C) $65,000 HST; Ontario rebate up to $24,000 and no federal rebate
HST in Ontario is 13%, so the tax on $500,000 is $65,000. The standard federal GST/HST new housing rebate is nil at a price of $450,000 or more, but the Ontario new housing rebate (75% of the 8% provincial part, capped at $24,000) has no price ceiling. The first-time buyer rebates and the Ontario enhanced rebate (agreements from April 1, 2026) do not apply to this buyer.
Why This Is the Correct Answer
The tax is 13% x $500,000 = $65,000. The federal new housing rebate is unavailable because the price is $450,000 or more. The Ontario rebate is 75% of the $40,000 provincial part ($30,000), capped at $24,000. So the buyer pays $65,000 HST and can recover up to $24,000.
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Previous Question
A developer purchases land for $1,000,000, builds a home for $800,000, and sells it for $2,200,000. If GST/HST of $286,000 was collected from the buyer, what is the developer's taxable income from this transaction?
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A first-time buyer purchases a $450,000 home in Ontario outside the City of Toronto and qualifies for the provincial first-time refund. What land transfer tax is payable after the refund?