New GST Rebate in canada

Written By Jaclyn McNeely

Big News for First-Time Home Buyers in Canada: Up to $50,000 in GST Savings on New Homes

As of May 27, 2025, the Canadian government has introduced a significant GST rebate program aimed at assisting first-time home buyers. This initiative offers substantial tax relief on new home purchases under $1 million, potentially saving eligible buyers up to $50,000.

What Is the New GST Rebate?

The First-Time Home Buyer (FTHB) GST Rebate is designed to reduce the financial burden on Canadians entering the housing market. This allows first-time home buyers to pay zero GST on new homes. The rebate provides:

  • Full GST rebate on new homes priced up to $1 million.

  • Partial GST rebate on new homes priced between $1 million and $1.5 million (this is a linear phase out, for example a home priced at $1.25 million would receive 50% GST rebate).

This program is expected to deliver approximately $3.9 billion in tax savings over five years, starting from the 2025–26 fiscal year

Who Is Eligible?

To qualify for the FTHB GST Rebate, applicants must:

  • Be first-time home buyers.

  • Be at least 18 years old.

  • Be a Canadian citizen or permanent resident.

  • Have not lived in a home both inside or outside of Canada that they, or their spouse or common-law partner, owned in the calendar year or in the four preceding calendar years.

  • Purchase a new home from a builder, build a home on owned or leased land, or buy shares in a co-operative housing corporation.

How to Apply

Eligible buyers can apply for the rebate by completing the necessary forms provided by the Canada Revenue Agency (CRA). Detailed instructions and forms are available on the CRA's official website

Why This Matters

With housing affordability being a pressing concern, this rebate aims to support Canadians in achieving their homeownership goals. By reducing the upfront costs associated with purchasing a new home, the government hopes to stimulate the market by helping spur housing development and by making homeownership more accessible for first-time buyers.

While some argue that this rebate is not enough, as very few new home purchasers are also first-time home buyers, it is a step in the right direction.

For those considering buying their first home, this rebate presents a valuable opportunity to reduce expenses and invest in their future.

Jaclyn McNeely
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