When is GST/HST typically payable on a residential real estate transaction?
Correct Answer
C) Only on new or substantially renovated homes sold by builders
GST/HST applies when a builder sells a new or substantially renovated home, because that is a taxable supply of real property. The resale of a used home by someone who is not its builder is an exempt supply under the Excise Tax Act, Schedule V, Part I, s. 2, so ordinary resales carry no GST/HST.
Why This Is the Correct Answer
This answer is correct: GST/HST is payable when a builder sells a new or substantially renovated home, while a used home resold by a non-builder is exempt under Schedule V, Part I, s. 2 of the Excise Tax Act.
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