Getting to Know the HST Rebate in Ontario
The Ontario HST rebate allows qualified buyers to recover some of the Harmonized Sales Tax on a new home or condo. Two rebates are available: the provincial Ontario New Housing Rebate and the federal New Housing Rebate. The house must be occupied as the buyer's primary residence or as a rental property for the long term. Simple enough for single buyers, but when there are multiple parties involved, it gets tricky.
Co-Ownership and Your Rebate
Sharing ownership of a condo can dramatically affect your chances of claiming the HST rebate on a new condo purchase. In cases where there are two or more individuals on the title, each of the individuals will need to qualify. For instance, where one co-owner plans to reside in the unit, and the other does not, the CRA may consider the purchase to be ineligible or partially ineligible for the rebate.
This can be a problem in Ontario since the rebate on the HST is applied only when the owners of a particular property file together and indicate that the said property is their home. The slightest deviation—like a parent buying the unit to help his or her child purchase it, but not moving into it—is going to leave the rebate unavailable and clawed back in the future. Rebate4U can help you navigate through the complexity of your case so you won't have thousands of dollars sucked out from you.
Real Situations to Consider
If two brothers jointly purchased a new condo and both wanted to occupy it, they would typically qualify for the full HST rebate for buying a new condo. However, if one of them plans to rent it out or occupy it elsewhere, eligibility will be lost.
Another common case is a parent-child co-ownership. If the parent is on title but doesn’t live in the unit, CRA may deny the HST rebate in Ontario, even if the child resides there full-time. That’s why it’s critical to establish ownership structures that reflect your intended use of the property.
How to Safeguard Your Rebate
The most effective way to protect your HST rebate on a new condo purchase is to discuss with a real estate lawyer or rebate specialist before signing on the dotted line. Ensure that all co-owners' occupancy intentions are clearly specified and truthful. Rearranging the purchase in certain cases, such as excluding a non-occupying parent from the title, can prevent your eligibility from being lost. Contact Rebate4U to discuss your personal situation and avoid a costly shock.
Don't Let Your Rebate Slip Away
Co-owning a condo can be an excellent money move, but it does add layers of complexity to your rebate claim. With the Ontario HST rebate potentially being as much as $30,000, you shouldn't take a risk. If you are buying with a roommate, family member, or investment partner, take the time to understand how your choices impact your rebate. For professional advice and peace of mind, contact Rebate4U—we will assist you in getting the best out of your new condo investment.
