If you are buying a brand new home in Ontario right now, you may be looking at the largest HST break this province has ever offered. For a limited window, buyers of new homes up to $1 million pay effectively no HST at all. Not just first-time buyers. Anyone buying the home as their primary residence gets the full 13 percent back, up to $130,000.
That is the short version. The longer version has price caps, deadlines, and a few traps, so let me walk through it the way I would with a client.
First, who actually pays HST on a home
Resale homes do not attract HST on the purchase price. If you are buying a 20-year-old house in Burlington, this whole topic does not apply to your purchase price at all. You only see HST on the services around the deal, things like legal fees and moving costs, which I covered in the closing costs post.
New homes are different. A newly built or substantially renovated home sold by a builder attracts the full 13 percent HST. On an $800,000 new build, that is $104,000 of tax. Rebates are how the government softens that number, and they have just gotten dramatically bigger.
The old rebate, which still matters
For years, the system worked like this. Ontario rebated 75 percent of its 8 percent share, capped at $24,000. The federal government rebated a portion of its 5 percent share, but only on homes under $450,000, which rules out almost everything around here.
Builders price with that $24,000 baked in. When you see a new home advertised as HST included, the builder is assuming you qualify for the rebate and will sign it over to them on closing. That assumption is exactly why investors get surprised, more on that below.
This old rebate is still the fallback for anyone who does not fit the new programs, and for homes above the new price bands.
What changed federally: the first-time buyer rebate
In 2025 Ottawa introduced a first-time home buyer GST rebate, and it became law in March 2026. It removes 100 percent of the 5 percent federal GST on a new home priced up to $1 million, worth up to $50,000. Between $1 million and $1.5 million the rebate shrinks on a sliding scale, and above $1.5 million it is gone.
To qualify you must be at least 18, a Canadian citizen or permanent resident, and a genuine first-time buyer, meaning neither you nor your spouse has lived in a home you owned in the past several years. The home must be your primary residence, and you can only use this rebate once in your lifetime. It covers agreements signed from March 20, 2025 through the end of 2030, and it also extends to owner-built homes.
Keep this one in mind mainly for timing: it started earlier and runs later than Ontario's window described next. The two programs do not pile on top of each other on the same dollars, though. The federal portion of the tax comes back once, whichever door you claim it through.
What changed provincially: Ontario's enhanced rebate
This is the big one, and the one with the clock on it. In its 2026 budget, Ontario introduced two pieces that work together. An enhanced HST rebate returns the entire 8 percent provincial portion on new homes up to $1 million, worth up to $80,000. And a top-up payment covers the 5 percent federal portion as well, worth up to another $50,000. Together they hand back the full 13 percent, up to $130,000 per home, and unlike the federal first-time buyer program, all of it is open to repeat buyers. You do not need to be a first-time buyer. You just need to be buying the home as your primary residence.
The price bands work like this. Up to $1 million, the full 13 percent comes back. From $1 million to $1.5 million, the rebate holds at its $130,000 maximum. From $1.5 million to $1.85 million it scales down from $130,000 to $24,000, and above $1.85 million you are back to the original $24,000 rebate.
Now the deadline, because this is genuinely time-limited. Your agreement of purchase and sale must be signed between April 1, 2026 and March 31, 2027. One year. Construction has to start by the end of 2028 and be substantially completed by the end of 2031, which matters for pre-construction buyers whose projects have long timelines.
Put together, the math gets remarkable
Any buyer signing on a $900,000 new build during the window, first purchase or fifth, gets the full 13 percent back: $45,000 on the federal portion plus $72,000 on the provincial portion, which is $117,000 that stays in their pocket. Two years ago the same buyer would have paid roughly $93,000 of HST after the old $24,000 rebate. That is effectively a tax-free purchase, and it applies to a repeat buyer moving up just as much as a first-timer. If you have been weighing new construction against resale, this window changes that comparison in a way few incentives ever have. First-time buyers should still read my first-time buyer guide for the rest of the picture, including the land transfer tax refund, which is a separate program and still available on resale homes.
The fine print that catches people
You have to live there. Every one of these rebates requires the home to be a primary residence for you or an immediate family member. An investor buying to rent does not qualify for these, though there is a parallel rental property rebate claimed from the CRA after closing. If you are not personally moving in, tell your lawyer before you sign, not on closing day, because the builder will otherwise add the rebate back onto your final price in cash.
Assigning the contract usually kills the rebate. Selling your pre-construction contract before closing generally means nobody gets the primary residence treatment you signed under.
The builder handles most of it. In the normal case you assign the rebates to the builder and the credit happens at closing. You should still see the numbers in writing from your own lawyer before you sign anything.
Rules this new always carry some moving parts, so treat the figures here as the map, and get the exact number for your purchase from your lawyer or accountant. If you are thinking about a new build in Burlington, Hamilton, or Niagara and want help weighing it against resale while this window is open, I would be glad to walk you through it.