A builder sells a newly built condominium unit in Ontario to a buyer for $500,000 before any tax. Which taxes apply to the purchase?
Correct Answer
D) 13% HST on the full $500,000 plus land transfer tax
A builder's sale of a new residential condominium unit is a taxable supply, so HST applies at 13% (5% federal plus the 8% Ontario component) on the full $500,000, or $65,000 before any new housing rebates. The buyer also pays Ontario land transfer tax when the transfer is registered: $6,475 on $500,000 under the Land Transfer Tax Act, s. 2(1).
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A property owner in Toronto sells their principal residence for $800,000 after purchasing it 5 years ago for $600,000. How much capital gains tax will they owe?
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A developer in Alberta sells a new condominium unit for $400,000 to a buyer who will live in it and who is not a first-time home buyer. The buyer paid $20,000 of GST. Under s. 254(2) of the Excise Tax Act, what is the GST new housing rebate?