Buying a new home in Ontario can be one of the most exciting — and expensive — financial decisions you’ll ever make. Between rising real estate prices, closing costs, and taxes, the total cost of homeownership can quickly add up. However, one major form of relief available to buyers is the Ontario HST Rebate, a government program that can return thousands of dollars to eligible new homeowners.
Here’s a complete breakdown of how the Ontario HST Rebate for new home buyers works in 2025, who qualifies, how much you can claim, and how to apply.
Understanding the Ontario HST
Ontario’s Harmonized Sales Tax (HST) is 13%, combining the 5% federal Goods and Services Tax (GST) with the 8% provincial portion (PST).
When you buy a newly built home or condo, HST is usually included in the purchase price. However, to make new housing more affordable, both the federal and provincial governments offer HST rebates that can refund part of that tax.
The rebate can apply to:
- Newly constructed or substantially renovated homes
- Homes purchased from a builder
- Owner-built homes
- Co-op housing units
- Mobile or modular homes
Two Parts of the HST Rebate
There are two key components of the HST rebate available to Ontario home buyers:
1. Federal GST/HST New Housing Rebate
This rebate covers the 5% federal portion of the HST.
- You can receive a maximum rebate of 36% on the federal portion of HST paid on the home’s purchase price, up to a maximum of $6,300.
- The full rebate is available for homes priced at $350,000 or less, and it phases out gradually for homes priced between $350,000 and $450,000.
- No federal rebate applies to homes priced above $450,000.
2. Ontario New Housing Rebate
This rebate covers the 8% provincial portion of the HST.
- You can claim up to 75% of the provincial portion of HST paid, up to a maximum of $24,000.
- Unlike the federal rebate, the Ontario portion does not phase out for homes above a certain value.
- This means you can still receive the provincial rebate even if your home costs more than $450,000.
Combined, these rebates can return up to $30,000 or more to eligible home buyers.
Who Is Eligible for the Ontario HST Rebate
To qualify for the Ontario HST Rebate, you must meet certain eligibility requirements based on your home purchase or construction situation:
For New Homes Purchased from a Builder:
- The home must be newly built or substantially renovated.
- You (or a close relative) must use the home as your primary place of residence.
- The purchase agreement must include HST, and the builder typically applies for the rebate on your behalf.
For Owner-Built Homes:
- You must have constructed or substantially renovated the home yourself.
- The home must be used as your primary residence or that of a close family member.
- You can claim the rebate after construction is complete and the home is ready for occupancy.
For Co-op Housing:
- You may qualify if you purchase a share in a housing co-operative that provides you with ownership rights in a newly built unit.
How to Apply for the Ontario HST Rebate
If your builder does not apply for the rebate on your behalf, you can submit your own application through the Canada Revenue Agency (CRA).
You’ll need to complete one or both of the following forms, depending on your situation:
- GST191 – New Housing Rebate Application for Owner-Built Houses
- GST190 – GST/HST New Housing Rebate Application for Houses Purchased from a Builder
You’ll also need to attach supporting documents such as:
- Purchase agreement or builder’s invoice
- Proof of occupancy (such as utility bills or property tax statements)
- Receipts for building materials (for owner-built homes)
Deadline: You must apply within two years of the date the home was substantially completed or ownership was transferred.
Example of How Much You Can Save
Let’s break down a sample rebate for a new home in Ontario priced at $600,000.
- Total HST (13%): $78,000
- Federal portion: $30,000 (5%)
- Provincial portion: $48,000 (8%)
Federal rebate: Not available (home over $450,000)
Ontario rebate: 75% of $48,000 = $36,000 (maximum $24,000 applies)
Total rebate: $24,000
So, you could receive $24,000 back on your home purchase — a substantial amount that can help with closing costs, furniture, or renovations.
Common Misconceptions About the HST Rebate
- “Only first-time home buyers qualify.”
– False. Anyone buying a new home or building one for personal use may qualify, regardless of whether it’s their first property. - “You can only get the rebate on cheaper homes.”
– Partially true. The federal portion phases out for homes over $450,000, but the Ontario rebate remains available for more expensive properties. - “Builders always handle the rebate.”
– Not always. While many do, it’s your responsibility to ensure the rebate was applied correctly and included in your purchase agreement.
Impact of the 2025 Housing Market on Rebates
With rising construction costs and record-high home prices, the Ontario HST rebate has become more critical than ever for buyers in 2025. The rebate offers a financial cushion that can make new homes more attainable despite interest rate challenges and inflation.
Real estate experts suggest that buyers should always confirm the rebate terms before signing a purchase agreement and factor them into their total cost calculations.
Key Takeaways
- The Ontario HST Rebate helps offset the 13% HST on new or newly built homes.
- You can save up to $30,000 combined from federal and provincial rebates.
- The federal portion phases out after $450,000, but the provincial portion remains available.
- You must occupy the home as your primary residence to qualify.
- The rebate must be claimed within two years of your purchase or completion date.
The Ontario HST Rebate for new home buyers in 2025 continues to be one of the most valuable financial tools for reducing the cost of homeownership. Whether you’re purchasing from a builder or constructing your dream home, taking advantage of this rebate can save you tens of thousands of dollars — money that can be redirected toward mortgage payments, upgrades, or savings.
Understanding how the rebate works and applying correctly ensures you maximize every dollar available. For Ontario home buyers, it’s a benefit too valuable to overlook.