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12 Mar

First Time Home Buyers Plan and Tax Credits (HBP & HBTC)

Income Tax

Publié par: Garth Chapman

First, some little-known good news: you don’t actually have to be a first-time homebuyer to qualify.  A first-time home buyer you must not have lived in another home owned by you or your spouse or common-law partner in the year of acquisition or any of the four preceding years.

So now let’s unpack the First-Time Home Buyer’s Tax Credit (HBTC).

The First-time Home Buyers’ Tax Credit was introduced to assist Canadians in purchasing their first home. It is designed to help recover closing costs, such as legal expenses, inspections, and land transfer taxes, so you can save more for money for a down payment.

The Home Buyers’ Tax Credit, at current taxation rates, works out to a rebate of $750 for all first-time buyers. After you buy your first home, the credit must be claimed within the year of purchase and it is non-refundable. In addition, the home you purchase must be a ‘qualified’ home, described in more detail below. If you are purchasing a home with a spouse, partner or friend, the combined claim cannot exceed $750.

You will qualify for the HBTC if:

  • you or your spouse or common-law partner acquired a qualifying home; and
  • you did not live in another home owned by you or your spouse or common-law partner in the year of acquisition or in any of the four preceding years.

Here is the link to the CRA webpage on the HBTC.