Buying a new home in Ontario just became significantly more affordable. Starting April 1, 2026, a landmark one-year window will eliminate the full 13% HST on new builds, saving you up to $130,000. Announced by Premier Doug Ford and supported by the federal Bill C-4, this massive tax break is now open to all buyers and investors. Here is everything you need to know to secure your savings.
Two Programs, One Massive Saving
The "HST Rebate" is actually the combination of two major legislative moves working in tandem:
Federal First-Time Buyer GST Rebate (Bill C-4): This eliminates the 5% federal portion of the tax (up to $50,000).
Ontario’s 2026 Expanded HST Rebate: For a one-year period, Ontario is removing the 8% provincial portion for all buyers (up to $80,000) and partnering with Ottawa to cover the 5% GST for non-first-time buyers as well.
Check Your Eligibility for Federal & Ontario New Home Rebates
Navigating the specific criteria for provincial and federal rebates can be complex. We built this calculator to help you estimate your potential savings at a glance. Please note that this tool is for informational purposes only and does not constitute legal, tax, or financial advice. Because program details and eligibility are subject to government updates, actual savings may vary. We strongly recommend consulting with a real estate, legal, or tax professional prior to signing any purchase agreement.
What About Investors and Rental Properties?
One of the biggest changes in the 2026 expansion is the inclusion of purpose-built rentals. To encourage supply, the government is allowing investors to claim the same 13% rebate as homeowners, provided the property is a long-term residential rental.
Rental Requirement: Construction must be substantially completed by December 31, 2029.
Cost-Sharing: This is handled through a special federal-provincial arrangement designed to stimulate the "missing middle" housing market.
How to Claim Your Rebate
For most buyers, the rebate is applied automatically at closing, reducing your final purchase price.
For New Purchases: Your builder credits the rebate directly on your Statement of Adjustments. They handle the paperwork, and you pay less on closing day.
For Retroactive Claims: If you closed your home between March 20, 2025, and March 12, 2026, you must apply directly to the CRA for a refund.
Pro Tip: Always ask your builder if the credit is included in your closing costs and have your real estate lawyer verify the amount.
Pro-Tips for Buyers in 2026
Watch the $1M Threshold: The "full" elimination is cleanest for homes under $1,000,000. Once you cross into the $1.5M+ range, the math gets more complex.
Combine Incentives: This rebate stacks with the First Home Savings Account (FHSA) and the Home Buyers’ Plan (HBP). You could theoretically use $60,000 from your RRSP, tax-free savings from your FHSA, and the $130,000 HST rebate all on the same purchase.
Consult a Lawyer: Because these programs are temporary and rely on specific "shovels in the ground" dates, have a real estate lawyer review your builder's contract to ensure the construction deadlines align with the rebate requirements.
Consult the Experts: Navigating pre-construction contracts and tax rebates requires specialized knowledge. For a comprehensive look at qualifying listings and expert guidance on maximizing these incentives, visit RE/MAX Plus City. Their team specializes in the Toronto and GTA pre-construction market and can ensure your contract is structured to protect your rebate.
Can I Combine the HST Rebate with Other Incentives?
Yes. The federal and provincial rebates are separate from other first-time buyer programs. You can use all of the following together to increase your purchasing power:
Home Buyers' Plan (HBP): Withdraw up to $60,000 tax-free from your RRSP to put toward your down payment.
First Home Savings Account (FHSA): Save up to $8,000 per year (up to $40,000 total) with tax-deductible contributions and tax-free withdrawals.
First-Time Home Buyers' Tax Credit: Claim a $1,500 federal tax credit on your income tax return the year you buy.
Ontario Expansion: If you're buying in Ontario during the expansion window, that rebate stacks on top of all the federal incentives listed above.
What This Means for the Real Estate Market?
By focusing strictly on new construction, these rebates are a strategic move to fix the root of the housing crisis: supply.
Economic Growth: Ontario projects this expansion will spark 8,000 new housing starts, support 21,000 jobs, and inject $2.7 billion into the province's GDP.
Addressing Shortages: With inventory levels at historic lows, these incentives are designed to give builders the green light to start more projects across Canada.
Total Relief: Between the provincial and federal levels, buyers are seeing nearly $2.2 billion in direct tax relief.
A Note for Buyers: While these savings are a significant windfall, remember that high demand can sometimes drive up home prices. The rebate is a massive win for your closing costs, but it doesn't change the fundamentals of your monthly mortgage budget. Always buy within your means.
What To Do Next To You Secure Your $130,000 Rebate?
If you're eyeing a new build in Ontario, follow these four steps to ensure you don't leave money on the table:
Confirm Your Eligibility: First-time buyers can combine federal and provincial programs for up to $130,000 in total relief. All other buyers can still claim the full 13% Ontario rebate during the expansion window.
Time Your Purchase: To secure the Ontario expansion, you must sign your agreement between April 1, 2026, and March 31, 2027. Federal first-time benefits remain available until late 2030.
Verify Closing Credits: Ask your builder if the rebate will be credited directly on your Statement of Adjustments. This reduces your out-of-pocket costs on closing day.
Consult a Professional: Have a real estate lawyer review the specific construction deadlines and the "fine print" of your contract before you sign.
The 2026 Advantage: With record-high tax relief and new federal incentives, this is a landmark year for new construction buyers. Proper planning is the key to maximizing these historic savings.
Frequently Asked Questions (FAQ)
Does the HST rebate apply to resale homes? No. Both the federal and provincial rebates apply strictly to newly constructed homes or substantially renovated properties. Resale homes are not subject to HST, so they do not qualify.
Do I qualify if I owned a home 5 years ago? Yes. Under the federal guidelines, you are considered a first-time buyer again if you have not owned and occupied a home as your primary residence during the current calendar year or the four preceding calendar years.
What happens if my home costs more than $1 million? The full 13% rebate is capped at homes priced up to $1 million. For homes priced between $1 million and $1.5 million, the rebate phases out proportionally. For homes over $1.85 million, you are only eligible for the pre-existing base rebate of $24,000.
Are investment properties eligible? Yes, but only during the 1-year Ontario expansion window (Agreements signed between April 1, 2026, and March 31, 2027). The property must be a purpose-built residential rental, and construction must be completed by December 31, 2029.
The Bottom Line
Ontario’s temporary HST rebate expansion creates a historic, one-year window of opportunity for buyers and investors alike. By waiving up to $130,000 in taxes, the barrier to entering the pre-construction and new build market has been dramatically lowered.
However, with strict overlapping deadlines for purchase agreements and construction completions, the paperwork must be flawless. Always work with an experienced Realtor visit RE/MAX Plus City and a qualified Real Estate Lawyer to ensure your agreement protects your eligibility for these massive savings.
