HST on a New Build —
What Actually Applies
Ontario added temporary enhanced relief in 2026, for owner-occupiers and for landlords. Which programs you can reach, and how much of it you see at closing, depends on how you will use the home.
Intended Use Drives
the Whole Outcome
An ordinary resale home in Ontario is generally exempt from HST on the purchase price, though tax still applies to services connected to the deal — commission, legal fees, inspections — and some resale transactions are treated differently, for example a home that has been substantially renovated or a property with a commercial component.
A new or substantially renovated home bought from a builder is different: HST applies to the price. A set of rebates can return part of it, and in 2026 Ontario added temporary enhanced relief on top of the standing programs.
Which of those rebates you can reach turns on how you will use the home — as a place you or a relation will live in, or as a rental. The two routes have different programs, different conditions, and a different cash requirement on closing day.
A hypothetical illustration of the problem this article is about: a buyer signs a pre-construction agreement intending to move in, the builder credits a rebate against the price, and by the time the unit is ready the buyer has decided to rent it out instead. The basis on which that credit was given no longer holds, and the amount has to be dealt with.
More Than One Rebate,
and They Interact
People talk about “the HST rebate” as one thing. On a new Ontario home there are several, they are administered by different bodies, and some of them reduce each other. Amounts below are maximums, not entitlements — each has its own conditions.
If you or a relation will live there
- Federal GST/HST new housing rebate — 36% of the federal part, to a maximum of $6,300.
- Federal first-time home buyers’ (FTHB) GST/HST rebate — up to $50,000 of the federal part, for a first-time buyer on a home valued up to $1 million, reducing to nil at $1.5 million.
- Ontario new housing rebate — 75% of the 8% provincial part, to a maximum of $24,000.
- Ontario first-time home buyers’ rebate — up to $80,000 of the provincial part for those buying, building or substantially renovating their first home in Ontario. It follows the same eligibility conditions as the federal FTHB rebate, so it is not tied to the temporary 1 April 2026 – 31 March 2027 ENHR signing window — a first-time buyer outside that window may still reach it.
- Ontario enhanced new housing rebate (ENHR) — temporary. With the Ontario new housing rebate, combined relief of up to $80,000 of the provincial part.
- Ontario new home affordability payment (ONHAP) — provincial relief under the Retail Sales Tax Act, equivalent to up to the full 5% federal part. Up to $50,000 per eligible new home or rental unit valued up to $1 million; the same $50,000 maximum applies above $1 million and up to $1.5 million; between $1.5 million and $1.85 million it decreases in a linear manner to nil. It is reduced by any rebates for the federal part of the HST the claimant is entitled to claim under the Excise Tax Act. It applies to eligible rental units as well as owner-occupied homes, and eligibility depends on qualifying for and receiving the Ontario ENHR or ENRRP rebate.
If you will rent it out
- GST/HST new residential rental property (NRRP) rebate — the federal rebate for landlords.
- Ontario NRRP rebate — 75% of the provincial part, to a maximum of $24,000 per qualifying rental unit, with no fair market value thresholds.
- Ontario enhanced NRRP (ENRRP) rebate — temporary. With the Ontario NRRP rebate, combined relief of up to $80,000.
- ONHAP — also available to landlords who qualify for and receive the Ontario ENRRP rebate, on the bands above.
- Purpose-built rental housing (PBRH) rebate — a separate federal program. Where housing is eligible for the PBRH rebate, the Ontario ENRRP rebate is not available for that housing.
Source: CRA Notice 346 — Ontario enhanced new housing rebate
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The Signing Window Is
One Condition of Several
For a home bought from a builder, the Ontario ENHR is generally available where the agreement of purchase and sale is entered into on or after 1 April 2026 and on or before 31 March 2027. Signing inside that window does not by itself establish eligibility. CRA sets out further conditions for a house-and-land purchase from a builder:
- Construction or substantial renovation must begin on or before 31 December 2028 and be substantially completed on or before 31 December 2031
- Total consideration payable for the complex must be less than $1,850,000
- The GST/HST on the supply must become payable on or before 31 December 2032
- The home must be acquired for use as your or your relation’s primary place of residence
- You must meet the conditions for the Ontario new housing rebate
Different conditions apply to owner-built homes, to a building bought on leased land, and to co-op shares — including different value tests and, for owner-built homes, a requirement that construction begin inside the same window. Check the notice for your situation rather than assuming the builder-purchase rules apply.
| New home value | Ontario ENHR with the Ontario new housing rebate |
|---|---|
| Up to $1 million | 100% of the 8% provincial part paid, to a maximum of $80,000 |
| Above $1 million, up to $1.5 million | Flat rebate of $80,000 |
| Above $1.5 million, below $1.85 million | Partial rebate of the provincial part paid |
| $1.85 million and above | No ENHR; only the Ontario new housing rebate of up to $24,000 |
Assignments and re-signed agreements
For an assignment, CRA requires that both the original agreement and the assignment agreement be entered into within the same 1 April 2026 to 31 March 2027 window. Where an agreement signed before 1 April 2026 is varied, altered or assigned so that it might otherwise count as a later agreement, it is deemed for ENHR purposes to have been entered into before 1 April 2026 — the ENHR is not available, though the Ontario new housing rebate or the Ontario first-time home buyers’ rebate may still be. Terminating an agreement and signing a new one can be caught by a similar rule. If your agreement predates the window, take advice before restructuring it.
Source: CRA Notice 346, Eligibility and Restrictions and special rules
Status Is Tested at
Closing, Not at Signing
The federal FTHB GST/HST rebate is not a rebate that a relation can occupy on your behalf: CRA requires the home to be bought for use as your primary place of residence, and that you are the first individual to occupy it after construction or substantial renovation is substantially completed.
To be a first-time home buyer, generally all of the following must be true:
- You are at least 18 years of age
- You are a Canadian citizen or permanent resident of Canada
- You have not lived in a home that you or your spouse or common-law partner owned, or jointly owned, in or outside Canada, as your primary place of residence at any time in the calendar year or the previous four calendar years
- Neither you nor your spouse or common-law partner has previously received an FTHB GST/HST rebate
When that test is applied matters. For a home purchased from a builder, you must be a first-time home buyer on the date ownership of the home is transferred to you — not on the date you signed. For a home where you lease the land, it is the date possession transfers. For an owner-built home it is the earlier of first occupancy and substantial completion. On a pre-construction timeline those dates can be years apart, and CRA’s own example shows a buyer who does not qualify on a 2026 closing but would on a 2027 one.
For a house and land bought from the same builder, the rebate is generally available where the agreement was entered into with the builder on or after 20 March 2025 and before 2031, construction begins before 2031 and is substantially completed before 2036, and ownership transfers to you before 2036.
Source: CRA — First-time home buyers’ GST/HST rebate, Who can apply
The Enhanced Rental Rules
Are Published
CRA publishes eligibility guidance for the Ontario enhanced new residential rental property (ENRRP) rebate. Together with the Ontario NRRP rebate it provides landlords combined relief of up to 100% of the 8% provincial part, on the same value bands as the owner-occupied rebate — up to $80,000, with only the Ontario NRRP rebate of up to $24,000 where fair market value is $1.85 million or more.
A separate technical notice on the enhanced rental rebate is still anticipated — Notice 346 says one is expected by October 2026 — but the eligibility guidance itself is already available and should be read now rather than waited for.
Two routes in, and they are not the same
For a purchaser/landlord leasing both housing and land, CRA sets out two paths:
- Construction or substantial renovation began between 1 April 2026 and 31 March 2027 (inclusive); or
- Construction began before 1 April 2026, and you entered into an agreement of purchase and sale for a single unit residential complex or residential condominium unit between 1 April 2026 and 31 March 2027 (inclusive)
A builder/landlord who self-supplies has only the first route: construction must have begun inside the window. And “construction begins” has a specific meaning — CRA treats it as the day excavation work relating to the complex began. Signing the agreement, demolition, testing, plans, permits and contracting for excavation do not start the clock.
The other conditions
- You must be eligible for the Ontario NRRP rebate
- Construction or substantial renovation substantially completed by 31 December 2029
- HST becomes payable by 31 December 2032
- Fair market value of the housing less than $1.85 million
Applications are open, by mail. CRA’s how-to-apply guidance for the enhanced rental rebate, updated 11 September 2026, sets out five application types with their own filing deadlines and lists the forms: GST524, RC7524-ON, and GST525 where applicable. Electronic filing is not currently available for this rebate — CRA says updates to allow it are expected in fall 2026, and until then applications must be submitted by mail. All claimants, purchasers and builders alike, apply directly to the CRA. An earlier Ontario statement that applications “will be available soon” has been overtaken by this guidance.
For assignments, both the initial agreement with the builder and the assignment agreement must fall inside the window.
- CRA’s Ontario ENRRP rebate — Who can apply states that where an agreement entered into before 1 April 2026 is changed so that it counts as entered into on or after that date, the agreement “must have been entered into for bona fide purposes other than to obtain the Ontario ENRRP rebate” to be eligible.
- CRA’s Guide RC4231, under Limitations, states the rebate “is not available” where an agreement entered into on or before 31 March 2026 is later “varied, amended or assigned” in a way that would otherwise make it a later agreement, because it is then “deemed to have been entered into before April 1, 2026” — and applies the bona fide test to the separate situation of an agreement cancelled and replaced.
What the Rental Rebate
Actually Requires
The NRRP rebate does not simply require “a one-year lease”. The test is about the unit’s first use, or the use that can reasonably be expected. One qualifying possibility is that the unit is an individual’s primary place of residence and that individual will occupy it continuously, under one or more leases, for at least a year — or for a shorter period if the unit is then sold to someone for use as their own or a relation’s primary place of residence, or taken by the owner or lessor or a relation for that use. Other qualifying first uses exist, and a multiple-unit complex has its own rule.
On filing: a purchaser/landlord generally has two years after the end of the month in which tax first becomes payable on the purchase. A builder/landlord who self-supplies has two years after the end of the month in which the self-supply occurred.
The repayment rule, stated accurately
The clock does not run from the date you claimed. For a rebate claimed on a lease of building and land, CRA requires repayment where all of the following are met:
- The rebate was for a qualifying residential unit other than a unit in a multiple unit residential complex
- The unit is sold within one year after it is first occupied as a place of residence following construction or the last substantial renovation — excluding seizure or repossession by a creditor, or transfer to an insurer to settle a claim
- The purchaser is not buying it for use as their primary place of residence, or that of a relation
Where that applies, the amount repayable is the rebate plus interest at the prescribed rate less 2% per year. Because all three conditions must be met, this does not apply identically to every property — a unit inside a multiple unit residential complex is outside this particular rule.
Source: CRA Guide RC4231, qualifying residential unit test and Repayment of the NRRP rebate
Credited at Closing,
or Paid and Reclaimed
For an eligible owner-occupier, the Ontario ENHR and the ONHAP can be paid or credited to the purchaser by the builder, as other new housing rebates can. That is an arrangement the builder agrees to, not something that happens automatically — and CRA is explicit that both parties must review the eligibility criteria. Where a builder credits an amount and knew or ought to have known the purchaser was not entitled to it, builder and purchaser are jointly and severally liable to repay it.
Two limits on that, both from Ontario’s own guidance. Builders will not be able to pay or credit the Ontario ENHR where GST/HST became payable before the implementing federal regulations were made on 12 June 2026 — in that case an eligible purchaser pays at closing and applies to the CRA directly. And the builder will not be able to credit the enhanced rental rebate at all, as is already the case for the existing federal and Ontario NRRP rebates.
A purchaser/landlord buying to rent therefore pays the applicable tax on closing and applies separately for any NRRP and enhanced rental rebate they are eligible for. The practical consequence is a cash-flow one: the amount you must have available on closing day is not the same as your eventual net tax cost. Nothing here guarantees that a rebate will be approved, that the full HST will be recovered, or how long processing will take.
When you compare a quoted price against your own budget, be clear which basis you are working from. A builder’s quoted price may be stated before HST, or on a basis that assumes rebates will be credited. That assumption depends on your eligibility, and your eligibility depends on facts that may not be settled until closing.
Source: CRA Guide RC4028 and Notice 346, Rebates paid or credited by the builder
Never Occupying, and
Later Changing Use
These are two different situations and they are often run together.
Never occupying the home. The owner-occupied rebates rest on the home being acquired as a primary place of residence — yours or a relation’s for the new housing and Ontario rebates. But never occupying it does not automatically defeat every rebate. For the ordinary new housing rebate the condition is met where you or your relation is the first to occupy the house or you made a qualifying exempt sale and transferred ownership before anyone occupied it, provided you originally intended it as a primary place of residence for you or a relation and the other conditions are met. Whether a sale is exempt turns on whether you are a builder for GST/HST purposes and whether input tax credits were claimed.
The federal first-time home buyers’ rebate is different: it carries its own requirement that you be the first individual to occupy the home after substantial completion, so that exempt-sale route does not read across to it.
Genuinely occupying it and later changing use. That is a different question, and later rental use does not automatically invalidate a rebate that was validly claimed at the time. Change-of-use rules may apply instead. This is fact-specific and worth professional advice rather than a rule of thumb.
If your intentions change between signing and closing — common on a multi-year pre-construction timeline — tell your lawyer before closing. Depending on the facts, you may qualify for the NRRP rebate instead, if all of its conditions are met. That is not a guaranteed substitute for the rebate you would otherwise have claimed.
Questions Worth
Settling in Writing
- On what basis is the price quoted? Before HST, or net of rebates the builder expects you to qualify for? Ask for it in writing.
- Has the builder agreed to credit any rebate at closing, and on what conditions? Crediting is by agreement, and both of you carry responsibility for the eligibility behind it.
- What does the agreement say happens if you do not occupy the home? Have your lawyer show you the clause before signing.
- Do the dates work — all of them? Not only the signing window, but construction start, substantial completion, and when tax becomes payable.
- If you are buying to rent, what do you need available on closing day? Budget the tax payable, not the expected net figure.
- If you are a first-time buyer, will you still meet the test on the closing date? It is assessed then, not at signing.
HST on New Builds,
Answered
Is there HST on a resale home in Ontario?
An ordinary resale home is generally exempt from HST on the purchase price. Tax still applies to services connected to the transaction, such as commission, legal fees and inspections. Some resale transactions are treated differently — for example a substantially renovated home, or a property with a commercial component — so confirm your situation with your lawyer.
How much is the Ontario enhanced new housing rebate, and what are the conditions?
Together with the Ontario new housing rebate it provides combined relief of up to $80,000 of the 8% provincial part of the HST. Up to $1 million of value it is 100% of the provincial part paid to that maximum; above $1 million and up to $1.5 million it is a flat $80,000; above $1.5 million and below $1.85 million it is partial; and at $1.85 million and above only the Ontario new housing rebate of up to $24,000 is available. For a home bought from a builder the agreement must be entered into on or after 1 April 2026 and on or before 31 March 2027, and CRA sets further conditions: construction beginning on or before 31 December 2028, substantial completion on or before 31 December 2031, total consideration less than $1,850,000, tax becoming payable on or before 31 December 2032, and the home acquired as your or your relation's primary place of residence.
When was the federal first-time home buyers' GST/HST rebate introduced, and when is status tested?
For a house and land bought from the same builder it is generally available where the agreement of purchase and sale was entered into on or after 20 March 2025 and before 2031, with construction beginning before 2031, substantially completed before 2036, and ownership transferred to you before 2036. First-time buyer status is tested on the date ownership of the home is transferred to you — not the date you signed. Where you lease the land it is the date possession transfers, and for an owner-built home the earlier of first occupancy and substantial completion.
Have the enhanced rebate rules for rental properties been published?
Yes. CRA publishes eligibility guidance for the Ontario enhanced new residential rental property (ENRRP) rebate, covering who can apply, the qualifying construction and purchase dates, value limits and restrictions. A separate technical notice is still anticipated — Notice 346 says one is expected by October 2026 — but the published guidance is available now and should be read rather than waited for. Applications are open: CRA's how-to-apply guidance, updated 11 September 2026, lists Forms GST524, RC7524-ON and GST525 where applicable, and states that electronic filing is not currently available for this rebate — updates to allow it are expected in fall 2026, so until then applications must be submitted by mail, directly to the CRA.
My building started before April 2026. Can I still qualify for the enhanced rental rebate?
Possibly. For a purchaser/landlord leasing both housing and land, CRA sets out two paths: construction or substantial renovation began between 1 April 2026 and 31 March 2027, or construction began before 1 April 2026 and you entered into an agreement of purchase and sale for a single unit residential complex or residential condominium unit between 1 April 2026 and 31 March 2027. A builder/landlord who self-supplies has only the first path. CRA treats construction as beginning when excavation work relating to the complex began, not when permits, plans or the agreement were done.
My agreement predates April 2026. Can I amend it to qualify for the enhanced rental rebate?
Do not assume so. Two CRA sources on the enhanced rental rebate read differently and we are not able to reconcile them. CRA's Ontario ENRRP rebate “Who can apply” page states that where an agreement entered into before 1 April 2026 is changed so that it counts as entered into on or after that date, it must have been entered into for bona fide purposes other than to obtain the rebate in order to be eligible. Guide RC4231, under Limitations, states the rebate is not available where such an agreement is later varied, amended or assigned, because it is then deemed to have been entered into before 1 April 2026 — reserving the bona fide test for an agreement that is cancelled and replaced. The practical consequence is that changing an earlier agreement should not be assumed to create eligibility: on one reading it can, on the other it cannot. Confirm your specific transaction with the CRA and with your own lawyer and accountant before acting. The two CRA routes differ: the GST/HST Rulings line, 1-800-959-8287, provides technical guidance, while a formal ruling you can rely on must be requested in writing, as GST/HST Memorandum 1-4 explains.
What is the ordinary Ontario rental rebate worth?
The Ontario new residential rental property rebate is equal to 75% of the provincial part of the HST paid on the purchase or self-supply of the new housing, up to a maximum of $24,000 per qualifying rental unit, with no fair market value thresholds, subject to meeting the eligibility conditions. That is separate from the temporary enhanced rental relief, which can bring the combined amount to as much as $80,000.
Do I need a one-year lease to claim the rental rebate?
The requirement is not simply a one-year lease. The test looks at the unit's first use, or the use that can reasonably be expected. One qualifying possibility is occupation by an individual as their primary place of residence continuously, under one or more leases, for at least a year — or a shorter period if the unit is then sold to someone for use as their own or a relation's primary place of residence, or taken by the owner or lessor or a relation for that use. Other qualifying first uses exist, and multiple unit complexes have their own rule.
If I sell a rental soon after claiming the rebate, do I have to repay it?
Not automatically, and the clock does not run from when you claimed. For a rebate claimed on a lease of building and land, repayment is required where all of the following apply: the rebate was for a qualifying residential unit other than one in a multiple unit residential complex; the unit is sold within one year after it is first occupied as a place of residence following construction or the last substantial renovation, excluding seizure or repossession by a creditor or transfer to an insurer; and the purchaser is not buying it as their own or a relation's primary place of residence. The amount repayable is the rebate plus interest at the prescribed rate less 2% per year.
If I never move in, do I automatically lose the rebate?
Not automatically. For the ordinary new housing rebate the occupancy condition is met where you or your relation is the first individual to occupy the house, or where you made a qualifying exempt sale and transferred ownership before anyone occupied it — provided you originally intended the house as a primary place of residence for you or a relation and the other conditions are met. Whether a sale is exempt depends on whether you are a builder for GST/HST purposes and whether input tax credits were claimed. The federal first-time home buyers' rebate is different: it requires that you be the first individual to occupy the home after substantial completion, so that route does not read across to it.
Will the builder credit the rebate to me at closing?
For an eligible owner-occupier the Ontario ENHR and the ONHAP can be paid or credited by the builder, but that is an arrangement the builder agrees to rather than something automatic, and both parties must review the eligibility criteria. Where a builder credits an amount and knew or ought to have known the purchaser was not entitled, builder and purchaser are jointly and severally liable to repay it. Ontario also states that builders will not be able to pay or credit the Ontario ENHR where GST/HST became payable before the implementing federal regulations were made on 12 June 2026, and that the builder will not be able to credit the enhanced rental rebate at all. A purchaser buying to rent pays the applicable tax on closing and applies separately for any rebate they are eligible for.
Is there an Ontario first-time home buyers' rebate, and is it tied to the 2026–27 window?
Yes. CRA states the Ontario FTHB rebate provides a rebate of up to $80,000 of the provincial part of the HST to individuals in Ontario buying, building or substantially renovating their first home in Ontario, and that it follows the same eligibility conditions as the federal FTHB GST/HST rebate. Because its eligibility follows the federal first-time buyers' rebate rather than the temporary enhanced rebate, it is not tied to the 1 April 2026 to 31 March 2027 signing window. Where someone is eligible for both it and the Ontario ENHR they may claim either or both, but the total of all rebates for the 8% provincial part cannot exceed the lesser of $80,000 and the provincial part of the HST payable.
Can I claim every rebate I am eligible for and add up the maximums?
No. Where an individual is eligible for both the Ontario ENHR and the Ontario first-time home buyers' rebate, CRA states the total of all rebates for the 8% provincial part cannot exceed the lesser of $80,000 and the provincial part of the HST payable. The Ontario new home affordability payment is reduced by any rebates for the federal part of the HST the claimant is entitled to claim under the Excise Tax Act, including applicable rental rebates. On the rental side, a landlord's combined rebate is reduced by rebates available to a purchaser where the home is sold and the land leased, and a landlord cannot claim both the Ontario ENRRP rebate and the purpose-built rental housing rebate for the same housing.
Read It
Yourself
Every figure and condition above was taken from the following CRA pages and read in full rather than summarised from elsewhere. If you are making a decision, read the source that matches your situation:
- CRA Notice 346 — Ontario enhanced new housing rebate
- CRA — Ontario enhanced new residential rental property (ENRRP) rebate
- CRA — First-time home buyers’ GST/HST rebate, Who can apply
- CRA GI-093 — Ontario new residential rental property rebate
- CRA Guide RC4231 — GST/HST new residential rental property rebate
- CRA Guide RC4028 — GST/HST new housing rebate
- CRA — Ontario ENRRP rebate, How to apply (updated 11 September 2026)
- Government of Ontario — Enhancing HST Relief on New Homes (backgrounder, published 26 March 2026, updated 23 July 2026)
Published 15 September 2026. Last reviewed against the sources above on 15 September 2026. Rebate programs and guidance change; CRA notices are stated to be correct at the time of issue and may not reflect later legislative change. Figures are maximums subject to eligibility, not amounts you are guaranteed to receive.
Buying a New Build?
Let’s Get You the Right Advice
We do not interpret tax law — that is your lawyer’s and accountant’s work. What we can do is make sure the right questions reach them in time: what the agreement actually says about occupancy and rebate credits, which dates matter for your purchase, and what you should have ready for closing day.
Laura Brown & Kristina Kritikos · Royal LePage Burloak Real Estate Services · 905-634-7755