On May 27, 2025, the Federal Government issued a press release that provides for a Goods and Services Tax (“GST”) rebate for first time home buyers (FTHB) of new homes (and co-ops). 
The press release indicates that the Excise Tax Act will be amended to provide FTHB with a full GST rebate on homes under $1,000,000, and a partial rebate on homes between $1,000,000 and $1,500,000.
Thank you to Spagnuolo and Co for this clarification.
Subject to agreement with the Builder, a FTHB will pay the GST on the closing of a purchase of a qualifying home, but will be eligible for a rebate of the full amount (up to $50,000). The rebate is phased out in a linear manner from $1,000,000 to $1,500,000. So, for example, a home that is $1,400,000 would lose 80% of the rebate – in other words, it would still be eligible for a 20% ($10,000) rebate.
As the legislation has not yet been passed (and the devil is in the details), there are many questions we are unable to answer at this time. Below are some frequently asked questions we received, together with answers based on available materials. We will continue to provide updates as more details emerge.
As the legislation has not yet been passed (and the devil is in the details), there are many questions we are unable to answer at this time. Below are some frequently asked questions we received, together with answers based on available materials. We will continue to provide updates as more details emerge.
FREQUENTLY ASKED QUESTIONS
When is the starting date of the rebate?
The agreement of purchase and sale must be entered into on or after May 27th, 2025 and before 2031. The construction of the home must begin before 2031 and is substantially completed before 2036. The rebate is not retroactive to contracts entered into prior to May 27th, 2025.
Can you clarify what a FTHB is with respect to the GST rebate?
A person is considered a FTHB if they
Are at least 18 years of age;
A Canadian citizen or permanent resident of Canada; and
Not have lived in a home, whether in or outside of Canada, that they owned or that their spouse or common-law partner owned in the calendar year or in the four preceding calendar years.
Are at least 18 years of age;
A Canadian citizen or permanent resident of Canada; and
Not have lived in a home, whether in or outside of Canada, that they owned or that their spouse or common-law partner owned in the calendar year or in the four preceding calendar years.
If a contract was entered into in 2023, but completion is scheduled for 2026, does the GST exemption apply?
No. The contract must be entered into after May 27, 2025
Can a client re-do their offer to purchase so the new contract is entered into after May 27th, 2025?